Cover Page
Cover Page | 9 Months Ended |
Jul. 31, 2021shares | |
Cover [Abstract] | |
Document Type | 10-Q |
Document Quarterly Report | true |
Document Period End Date | Jul. 31, 2021 |
Document Transition Report | false |
Entity File Number | 1-4423 |
Entity Registrant Name | HP INC. |
Entity Incorporation, State or Country Code | DE |
Entity Tax Identification Number | 94-1081436 |
Entity Address, Address Line One | 1501 Page Mill Road |
Entity Address, City or Town | Palo Alto, |
Entity Address, State or Province | CA |
Entity Address, Postal Zip Code | 94304 |
City Area Code | 650 |
Local Phone Number | 857-1501 |
Title of 12(b) Security | Common stock, par value $0.01 per share |
Trading Symbol | HPQ |
Security Exchange Name | NYSE |
Entity Current Reporting Status | Yes |
Entity Interactive Data Current | Yes |
Entity Filer Category | Large Accelerated Filer |
Entity Small Business | false |
Entity Emerging Growth Company | false |
Entity Shell Company | false |
Entity Common Stock, Shares Outstanding | 1,152,518,738 |
Entity Central Index Key | 0000047217 |
Amendment Flag | false |
Current Fiscal Year End Date | --10-31 |
Document Fiscal Year Focus | 2021 |
Document Fiscal Period Focus | Q3 |
Consolidated Condensed Statemen
Consolidated Condensed Statements of Earnings (Unaudited) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2021 | Jul. 31, 2020 | Jul. 31, 2021 | Jul. 31, 2020 | |
Income Statement [Abstract] | ||||
Net revenue | $ 15,289 | $ 14,294 | $ 46,812 | $ 41,381 |
Costs and expenses: | ||||
Cost of revenue | 11,901 | 11,901 | 36,660 | 33,623 |
Research and development | 477 | 359 | 1,462 | 1,097 |
Selling, general and administrative | 1,408 | 1,156 | 4,267 | 3,662 |
Restructuring and other charges | 56 | 59 | 216 | 431 |
Acquisition-related charges | 24 | 11 | 40 | 14 |
Amortization of intangible assets | 42 | 29 | 103 | 84 |
Total costs and expenses | 13,908 | 13,515 | 42,748 | 38,911 |
Earnings from operations | 1,381 | 779 | 4,064 | 2,470 |
Interest and other, net | (55) | (28) | (106) | (15) |
Earnings before taxes | 1,326 | 751 | 3,958 | 2,455 |
Provision for taxes | (218) | (17) | (554) | (279) |
Net earnings | $ 1,108 | $ 734 | $ 3,404 | $ 2,176 |
Net earnings per share: | ||||
Basic (usd per share) | $ 0.94 | $ 0.52 | $ 2.76 | $ 1.52 |
Diluted (usd per share) | $ 0.92 | $ 0.52 | $ 2.73 | $ 1.51 |
Weighted-average shares used to compute net earnings per share: | ||||
Basic (shares) | 1,185 | 1,417 | 1,235 | 1,435 |
Diluted (shares) | 1,199 | 1,423 | 1,247 | 1,441 |
Consolidated Condensed Statem_2
Consolidated Condensed Statements of Comprehensive Income (Unaudited) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2021 | Jul. 31, 2020 | Jul. 31, 2021 | Jul. 31, 2020 | |
Statement of Comprehensive Income [Abstract] | ||||
Net earnings | $ 1,108 | $ 734 | $ 3,404 | $ 2,176 |
Change in unrealized components of available-for-sale debt securities: | ||||
Unrealized gains arising during the period | 1 | 2 | 5 | 1 |
Change in unrealized components of cash flow hedges: | ||||
Unrealized gains (losses) arising during the period | 133 | (563) | (254) | (272) |
Losses (gains) reclassified into earnings | 64 | (130) | 262 | (242) |
Change in unrealized components of cash flow hedges | 197 | (693) | 8 | (514) |
Change in unrealized components of defined benefit plans: | ||||
(Losses) gains arising during the period | (1) | (5) | 40 | (6) |
Amortization of actuarial loss and prior service benefit | 20 | 20 | 62 | 61 |
Curtailments, settlements and other | 0 | 2 | 1 | 3 |
Change in unrealized components of defined benefit plans | 19 | 17 | 103 | 58 |
Change in cumulative translation adjustment | 2 | 15 | 35 | 4 |
Other comprehensive income (loss) before taxes | 219 | (659) | 151 | (451) |
(Provision for) benefit from taxes | (32) | 104 | (41) | 71 |
Other comprehensive income (loss), net of taxes | 187 | (555) | 110 | (380) |
Comprehensive income | $ 1,295 | $ 179 | $ 3,514 | $ 1,796 |
Consolidated Condensed Balance
Consolidated Condensed Balance Sheets (Unaudited) - USD ($) $ in Millions | Jul. 31, 2021 | Oct. 31, 2020 |
Current assets: | ||
Cash and cash equivalents | $ 3,439 | $ 4,864 |
Accounts receivable, net of allowance for credit losses of $117 and $122, respectively | 4,908 | 5,381 |
Inventory | 8,165 | 5,963 |
Other current assets | 4,091 | 4,440 |
Total current assets | 20,603 | 20,648 |
Property, plant and equipment, net | 2,500 | 2,627 |
Goodwill | 6,628 | 6,380 |
Other non-current assets | 5,792 | 5,026 |
Total assets | 35,523 | 34,681 |
Current liabilities: | ||
Notes payable and short-term borrowings | 214 | 674 |
Accounts payable | 15,898 | 14,704 |
Other current liabilities | 11,555 | 10,842 |
Total current liabilities | 27,667 | 26,220 |
Long-term debt | 6,898 | 5,543 |
Other non-current liabilities | 4,900 | 5,146 |
Stockholders’ deficit: | ||
Preferred stock, $0.01 par value (300 shares authorized; none issued) | 0 | 0 |
Common stock, $0.01 par value (9,600 shares authorized; 1,153 and 1,304 shares issued and outstanding at July 31, 2021 and October 31, 2020, respectively) | 12 | 13 |
Additional paid-in capital | 1,050 | 963 |
Accumulated deficit | (3,871) | (1,961) |
Accumulated other comprehensive loss | (1,133) | (1,243) |
Total stockholders’ deficit | (3,942) | (2,228) |
Total liabilities and stockholders’ deficit | $ 35,523 | $ 34,681 |
Consolidated Condensed Balanc_2
Consolidated Condensed Balance Sheets (Unaudited) (Parenthetical) - USD ($) $ in Millions | Jul. 31, 2021 | Oct. 31, 2020 |
Statement of Financial Position [Abstract] | ||
Allowance for credit loss | $ 117 | $ 122 |
Preferred stock, par value (usd per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 300,000,000 | 300,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Common stock, par value (usd per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 9,600,000,000 | 9,600,000,000 |
Common stock, shares issued (in shares) | 1,153,000,000 | 1,304,000,000 |
Common stock, shares outstanding (in shares) | 1,153,000,000 | 1,304,000,000 |
Consolidated Condensed Statem_3
Consolidated Condensed Statements of Cash Flows (Unaudited) - USD ($) $ in Millions | 9 Months Ended | |
Jul. 31, 2021 | Jul. 31, 2020 | |
Cash flows from operating activities: | ||
Net earnings | $ 3,404 | $ 2,176 |
Adjustments to reconcile net earnings to net cash provided by operating activities: | ||
Depreciation and amortization | 585 | 593 |
Stock-based compensation expense | 260 | 221 |
Restructuring and other charges | 216 | 431 |
Deferred taxes on earnings | (93) | 146 |
Other, net | 254 | 281 |
Changes in operating assets and liabilities, net of acquisitions: | ||
Accounts receivable | 503 | 699 |
Inventory | (2,225) | (247) |
Accounts payable | 1,140 | (433) |
Net investment in leases | (78) | (112) |
Taxes on earnings | 19 | (238) |
Restructuring and other | (166) | (412) |
Other assets and liabilities | (258) | (663) |
Net cash provided by operating activities | 3,561 | 2,442 |
Cash flows from investing activities: | ||
Investment in property, plant and equipment | (410) | (464) |
Proceeds from sale of property, plant and equipment | 0 | 3 |
Purchases of available-for-sale securities and other investments | (24) | (533) |
Maturities and sales of available-for-sale securities and other investments | 283 | 303 |
Collateral posted for derivative instruments | 121 | (240) |
Payment made in connection with business acquisitions, net of cash acquired | (582) | 0 |
Net cash used in investing activities | (612) | (931) |
Cash flows from financing activities: | ||
Proceeds from short-term borrowings with original maturities greater than 90 days | 22 | 19 |
Proceeds from debt, net of issuance costs | 2,052 | 3,051 |
Payment of debt | (1,192) | (1,788) |
Stock-based award activities and others | (42) | (125) |
Repurchase of common stock | (4,495) | (1,767) |
Cash dividends paid | (719) | (759) |
Net cash used in financing activities | (4,374) | (1,369) |
(Decrease) increase in cash and cash equivalents | (1,425) | 142 |
Cash and cash equivalents at beginning of period | 4,864 | 4,537 |
Cash and cash equivalents at end of period | $ 3,439 | $ 4,679 |
Consolidated Condensed Statem_4
Consolidated Condensed Statements of Stockholders Deficit (Unaudited) - USD ($) shares in Thousands, $ in Millions | Total | Adjustment for adoption of accounting standards | Common Stock | Additional Paid-in Capital | Accumulated Deficit | Accumulated DeficitAdjustment for adoption of accounting standards | Accumulated Other Comprehensive Loss |
Balance (in shares) at Oct. 31, 2019 | 1,457,719 | ||||||
Balance at Oct. 31, 2019 | $ (1,193) | $ 27 | $ 15 | $ 835 | $ (818) | $ 27 | $ (1,225) |
Increase (Decrease) in Stockholders' Equity | |||||||
Net earnings | 2,176 | 2,176 | |||||
Other comprehensive income (loss), net of taxes | (380) | (380) | |||||
Comprehensive income | 1,796 | ||||||
Issuance of common stock in connection with employee stock plans and other (in shares) | 13,143 | ||||||
Issuance of common stock in connection with employee stock plans and other | $ (35) | (35) | |||||
Repurchases of common stock (in shares) | (97,000) | (97,365) | |||||
Repurchases of common stock (Note 10) | $ (1,801) | $ (1) | (63) | (1,737) | |||
Cash dividends declared | (1,001) | (1,001) | |||||
Stock-based compensation expense | 221 | 221 | |||||
Balance (in shares) at Jul. 31, 2020 | 1,373,497 | ||||||
Balance at Jul. 31, 2020 | (1,986) | $ 14 | 958 | (1,353) | (1,605) | ||
Balance (in shares) at Apr. 30, 2020 | 1,429,957 | ||||||
Balance at Apr. 30, 2020 | (743) | $ 14 | 926 | (633) | (1,050) | ||
Increase (Decrease) in Stockholders' Equity | |||||||
Net earnings | 734 | 734 | |||||
Other comprehensive income (loss), net of taxes | (555) | (555) | |||||
Comprehensive income | 179 | ||||||
Issuance of common stock in connection with employee stock plans and other (in shares) | 2,379 | ||||||
Issuance of common stock in connection with employee stock plans and other | $ 23 | 23 | |||||
Repurchases of common stock (in shares) | (59,000) | (58,839) | |||||
Repurchases of common stock (Note 10) | $ (1,001) | (40) | (961) | ||||
Cash dividends declared | (493) | (493) | |||||
Stock-based compensation expense | 49 | 49 | |||||
Balance (in shares) at Jul. 31, 2020 | 1,373,497 | ||||||
Balance at Jul. 31, 2020 | $ (1,986) | $ 14 | 958 | (1,353) | (1,605) | ||
Balance (in shares) at Oct. 31, 2020 | 1,304,000 | 1,303,927 | |||||
Balance at Oct. 31, 2020 | $ (2,228) | $ 13 | 963 | (1,961) | (1,243) | ||
Increase (Decrease) in Stockholders' Equity | |||||||
Net earnings | 3,404 | 3,404 | |||||
Other comprehensive income (loss), net of taxes | 110 | 110 | |||||
Comprehensive income | 3,514 | ||||||
Issuance of common stock in connection with employee stock plans and other (in shares) | 11,385 | ||||||
Issuance of common stock in connection with employee stock plans and other | $ (41) | (41) | |||||
Repurchases of common stock (in shares) | (163,000) | (162,793) | |||||
Repurchases of common stock (Note 10) | $ (4,504) | $ (1) | (132) | (4,371) | |||
Cash dividends declared | (943) | (943) | |||||
Stock-based compensation expense | $ 260 | 260 | |||||
Balance (in shares) at Jul. 31, 2021 | 1,153,000 | 1,152,519 | |||||
Balance at Jul. 31, 2021 | $ (3,942) | $ 12 | 1,050 | (3,871) | (1,133) | ||
Balance (in shares) at Apr. 30, 2021 | 1,201,255 | ||||||
Balance at Apr. 30, 2021 | (3,360) | $ 12 | 1,018 | (3,070) | (1,320) | ||
Increase (Decrease) in Stockholders' Equity | |||||||
Net earnings | 1,108 | 1,108 | |||||
Other comprehensive income (loss), net of taxes | 187 | 187 | |||||
Comprehensive income | 1,295 | ||||||
Issuance of common stock in connection with employee stock plans and other (in shares) | 968 | ||||||
Issuance of common stock in connection with employee stock plans and other | $ 7 | 7 | |||||
Repurchases of common stock (in shares) | (50,000) | (49,704) | |||||
Repurchases of common stock (Note 10) | $ (1,500) | (44) | (1,456) | ||||
Cash dividends declared | (453) | (453) | |||||
Stock-based compensation expense | $ 69 | 69 | |||||
Balance (in shares) at Jul. 31, 2021 | 1,153,000 | 1,152,519 | |||||
Balance at Jul. 31, 2021 | $ (3,942) | $ 12 | $ 1,050 | $ (3,871) | $ (1,133) |
Consolidated Condensed Statem_5
Consolidated Condensed Statements of Stockholders’ Deficit (Unaudited) (Parenthetical) - $ / shares | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2021 | Jul. 31, 2020 | Jul. 31, 2021 | Jul. 31, 2020 | |
Statement of Stockholders' Equity [Abstract] | ||||
Cash dividends per share (usd per share) | $ 0.39 | $ 0.35 | $ 0.78 | $ 0.70 |
Basis of Presentation
Basis of Presentation | 9 Months Ended |
Jul. 31, 2021 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation Basis of Presentation The accompanying Consolidated Condensed Financial Statements of HP and its wholly-owned subsidiaries are prepared in conformity with United States (“U.S.”) generally accepted accounting principles (“GAAP”). 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, 2020 in the Annual Report on Form 10-K, filed on December 10, 2020. The Consolidated Condensed Balance Sheet for October 31, 2020 was derived from audited financial statements. Principles of Consolidation The Consolidated Condensed Financial Statements include the accounts of HP and its subsidiaries and affiliates in which HP has a controlling financial interest or is the primary beneficiary. All intercompany balances and transactions have been eliminated. Use of Estimates The preparation of financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in HP’s Consolidated Condensed Financial Statements and accompanying notes. Actual results may differ materially from those estimates. As of July 31, 2021, 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 a result, many of our estimates and assumptions required increased judgment and may carry a higher degree of variability and volatility. As the events continue to evolve with respect to the pandemic, our estimates may materially change in future periods. Separation Transaction On November 1, 2015, Hewlett-Packard Company completed the separation of Hewlett Packard Enterprise Company (“Hewlett Packard Enterprise”), Hewlett-Packard Company’s former enterprise technology infrastructure, software, services and financing businesses (the “Separation”). In connection with the Separation, HP and Hewlett Packard Enterprise entered into a separation and distribution agreement, an employee matters agreement and various other agreements which remain enforceable and provide a framework for the continuing relationships between the parties. For more information on the impacts of these agreements, see Note 12, “Litigation and Contingencies”. Recently Adopted Accounting Pronouncements In June 2016, the FASB issued guidance, which requires credit losses on financial assets measured at amortized cost basis to be presented at the net amount expected to be collected, not based on incurred losses. Furthermore, credit losses on available-for-sale debt securities should be recorded through an allowance for credit losses limited to the amount by which fair value is below amortized cost. HP adopted the new credit loss standard as of November 1, 2020 using a modified retrospective approach. The cumulative effect upon adoption was not material to the consolidated condensed financial statements. Accounts receivable HP records allowance for credit losses for the current expected credit losses inherent in the asset over its expected life. The allowance for credit losses is maintained based on the relevant information about past events, including historical experience, current conditions, and reasonable and supportable forecasts that affect the collectability of the reported amount. HP records a specific reserve for individual accounts when HP becomes aware of specific customer circumstances, such as in the case of a bankruptcy filing or deterioration in the customer’s operating results or financial position. If there are additional changes in circumstances related to the specific customer, HP further adjusts estimates of the recoverability of receivables. HP assesses collectability by pooling receivables where similar risk characteristics exist. HP maintains an allowance for credit losses for all other customers based on a variety of factors, including the use of third-party credit risk models that generate quantitative measures of default probabilities based on market factors, financial condition of customers, length of time receivables are past due, trends in the weighted-average risk rating for the portfolio, macroeconomic conditions, information derived from competitive benchmarking, significant one-time events, and historical experience. The past due or delinquency status of a receivable is based on the contractual payment terms of the receivable. HP has third-party short-term financing arrangements intended to facilitate the working capital requirements of certain customers. These financing arrangements, which in certain cases provide for partial recourse, result in the transfer of HP’s trade receivables to a third-party. HP reflects amounts transferred to, but not yet collected from the third-party in Accounts receivable in the Consolidated Condensed Balance Sheets. For arrangements involving an element of recourse, the fair value of the recourse obligation is measured using market data from similar transactions and reported as a current liability in the Consolidated Condensed Balance Sheets. Debt and Marketable Equity Securities Investments HP determines the appropriate classification of its investments at the time of purchase and re-evaluates the classifications at each balance sheet date. Debt and marketable equity securities are generally considered available-for-sale. All highly liquid investments with maturities of three months or less at the date of purchase are classified as cash equivalents. Marketable debt securities with maturities of twelve months or less are classified as short-term investments and marketable debt securities with maturities greater than twelve months are classified based on their availability for use in current operations. Marketable equity securities, including mutual funds, are classified as either short or long-term based on the nature of each security and its availability for use in current operations. Available-for-sale debt securities are reported at fair value with unrealized gains and losses, net of applicable taxes, in Accumulated other comprehensive loss. Unrealized gains and losses on equity securities, credit losses and impairments on available-for-sale debt securities are recorded in Consolidated Condensed Statements of Earnings. Realized gains and losses on available-for-sale securities are calculated at the individual security level and included in Interest and other, net in the Consolidated Condensed Statements of Earnings. HP monitors its investment portfolio for potential impairment and credit losses on a quarterly basis. If HP intends to sell a debt security or it is more likely than not that HP will be required to sell the security before recovery, then a decline in fair value below cost is recorded as an impairment charge in Interest and other, net and a new cost basis in the investment is established. In other cases, if the carrying amount of an investment in debt securities exceeds its fair value and the decline in value is determined to be due to credit related reasons, HP records a credit loss allowance, limited by the amount that fair value is less than the amortized cost basis. HP recognizes the corresponding charge in Interest and other, net and the remaining unrealized loss, if any, in Accumulated other comprehensive loss in the Consolidated Condensed Balance Sheets. Factors that HP considers while determining the credit loss allowance includes, but is not limited to, severity and the reason for the decline in value, interest rate changes and counterparty long-term ratings. |
Segment Information
Segment Information | 9 Months Ended |
Jul. 31, 2021 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information HP is a leading global provider of personal computing and other access devices, imaging and printing products, and related technologies, solutions and services. HP sells to individual consumers, small- and medium-sized businesses (“SMBs”) and large enterprises, including customers in the government, health and education sectors. HP goes to market through its extensive channel network and direct sales. HP’s operations are organized into three reportable segments: Personal Systems, Printing, and Corporate Investments. HP’s organizational structure is based on many factors that the chief operating decision maker (“CODM”) uses to evaluate, view and run the business operations, which include, but are not limited to, customer base and homogeneity of products and technology. The segments are based on this organizational structure and information reviewed by HP’s CODM to evaluate segment results. The CODM uses several metrics to evaluate the performance of the overall business, including earnings from operations, and uses these results to allocate resources to each of the segments. A summary description of each segment is as follows: Personal Systems offers commercial and consumer desktop and notebook personal computers (“PCs”), workstations, thin clients, commercial mobility devices, retail point-of-sale (“POS”) systems, displays and peripherals, software, support and services. HP groups commercial notebooks, commercial desktops, commercial services, commercial mobility devices, commercial detachables and convertibles, workstations, retail POS systems and thin clients into commercial PCs and consumer notebooks, consumer desktops, consumer services and consumer detachables into consumer PCs when describing performance in these markets. Described below are HP’s global business capabilities within Personal Systems: • Commercial PCs are optimized for use by enterprise, public sector which includes education, and SMB customers, with a focus on robust designs, security, serviceability, connectivity, reliability and manageability in the customer’s environment. Additionally, HP offers a range of services and solutions to enterprise, public sector which includes education, and SMB customers to help them manage the lifecycle of their PC and mobility installed base. • Consumer PCs are optimized for consumer usage, focusing on gaming, learning and working remotely, consuming multi-media for entertainment, managing personal life activities, staying connected, sharing information, getting things done for work including creating content and staying informed and secure. Personal Systems groups its global business capabilities into the following business units when reporting business performance: • Notebooks consists of consumer notebooks, commercial notebooks, mobile workstations, peripherals, and commercial mobility devices; • Desktops includes consumer desktops, commercial desktops, thin clients, displays, peripherals, and retail POS systems; • Workstations consists of desktop workstations, displays, and peripherals; and • Other consists of consumer and commercial services as well as other Personal Systems capabilities. Printing provides consumer and commercial printer hardware, supplies, services and solutions. Printing is also focused on imaging solutions in the commercial and industrial markets. Described below are HP’s global business capabilities within Printing. • Office Printing Solutions delivers HP’s office printers, supplies, services and solutions to SMBs and large enterprises. It also includes OEM hardware and solutions, and some Samsung-branded supplies. • Home Printing Solutions delivers innovative printing products, supplies, services and solutions for the home, home business and micro business customers utilizing both HP’s Ink and Laser technologies. It also includes some Samsung-branded supplies. • Graphics Solutions delivers large-format, commercial and industrial solutions and supplies to print service providers and packaging converters through a wide portfolio of printers and presses (HP DesignJet, HP Latex, HP Indigo and HP PageWide Web Presses). • 3D Printing & Digital Manufacturing offers a portfolio of additive manufacturing solutions and supplies to help customers succeed in their additive and digital manufacturing journey. HP offers complete solutions in collaboration with an ecosystem of partners. 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; • Consumer consists of home printing solutions, excluding supplies; and • 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. Corporate Investments includes HP Labs and certain business incubation and investment projects. The accounting policies HP uses to derive segment results are substantially the same as those used by HP in preparing these financial statements. HP derives the results of the business segments directly from its internal management reporting system. 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. Segment Operating Results from Operations and the reconciliation to HP consolidated results were as follows: Three months ended July 31 Nine months ended July 31 2021 2020 2021 2020 In millions Net revenue: Notebooks $ 7,328 $ 7,304 $ 22,183 $ 18,361 Desktops 2,246 2,221 6,871 7,553 Workstations 388 428 1,177 1,461 Other 444 407 1,333 1,190 Personal Systems 10,406 10,360 31,564 28,565 Supplies 3,092 2,573 9,575 8,455 Commercial 1,070 732 3,112 2,616 Consumer 720 628 2,562 1,744 Printing 4,882 3,933 15,249 12,815 Corporate Investments — 1 1 2 Total segment net revenue 15,288 14,294 46,814 41,382 Other 1 — (2) (1) Total net revenue $ 15,289 $ 14,294 $ 46,812 $ 41,381 Earnings before taxes: Personal Systems $ 869 $ 570 $ 2,337 $ 1,784 Printing 857 480 2,806 1,782 Corporate Investments (20) (15) (82) (42) Total segment earnings from operations 1,706 1,035 5,061 3,524 Corporate and unallocated costs and other (134) (108) (378) (304) Stock-based compensation expense (69) (49) (260) (221) Restructuring and other charges (56) (59) (216) (431) Acquisition-related charges (24) (11) (40) (14) Amortization of intangible assets (42) (29) (103) (84) Interest and other, net (55) (28) (106) (15) Total earnings before taxes $ 1,326 $ 751 $ 3,958 $ 2,455 |
Restructuring and Other Charges
Restructuring and Other Charges | 9 Months Ended |
Jul. 31, 2021 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Other Charges | Restructuring and Other Charges Summary of Restructuring Plans HP’s restructuring activities for the nine months ended July 31, 2021 and 2020 summarized by plan were as follows: Fiscal 2020 Plan Severance and EER Non-labor Other prior-year Plans Total In millions Accrued balance as of October 31, 2020 $ 55 $ — $ 12 $ 67 Charges 164 35 — 199 Cash payments (132) (4) (12) (148) Non-cash and other adjustments (1) (31) — (32) Accrued balance as of July 31, 2021 $ 86 $ — $ — $ 86 Total costs incurred to date as of July 31, 2021 $ 592 $ 45 $ 1,817 $ 2,454 Reflected in Consolidated Condensed Balance Sheets Other current liabilities $ 86 $ — $ — $ 86 Accrued balance as of October 31, 2019 $ 76 $ — $ 66 $ 142 Charges 325 5 1 331 Cash payments (256) (5) (48) (309) Non-cash and other adjustments (48) (1) — (3) (51) Accrued balance as of July 31, 2020 $ 97 $ — $ 16 $ 113 (1) Includes reclassification of liability related to the Enhanced Early Retirement (“EER”) plan of $44 million for certain healthcare and medical savings account benefits to pension and post-retirement plans. HP’s restructuring charges for the three months ended July 31, 2021 summarized by the plans outlined below were as follows: Fiscal 2020 Plan Severance and EER Non-labor Total In millions For the three months ended July 31, 2021 $ 28 $ 20 $ 48 Fiscal 2020 Plan On September 30, 2019, HP’s Board of Directors approved the Fiscal 2020 Plan intended to optimize and simplify its operating model and cost structure that HP expects will be implemented through fiscal 2022. HP expects to reduce global headcount by approximately 7,000 to 9,000 employees through a combination of employee exits and voluntary EER. HP estimates that it will incur pre-tax charges of approximately $1.0 billion relating to labor and non-labor actions. HP now expects to incur approximately $0.8 billion primarily in labor costs related to workforce reductions and the remaining costs will relate to non-labor actions and other charges. Other charges Other charges include non-recurring costs, including those as a result of information technology rationalization efforts and proxy contest activities, and are distinct from ongoing operational costs. These costs primarily relate to third-party legal, professional services and other non-recurring costs. For the three and nine months ended July 31, 2021, HP incurred $8 million |
Retirement and Post-Retirement
Retirement and Post-Retirement Benefit Plans | 9 Months Ended |
Jul. 31, 2021 | |
Retirement Benefits [Abstract] | |
Retirement and Post-Retirement Benefit Plans | Retirement and Post-Retirement Benefit Plans 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 July 31 U.S. Defined Benefit Plans Non-U.S. Defined Benefit Plans Post-Retirement Benefit Plans 2021 2020 2021 2020 2021 2020 In millions Service cost $ — $ — $ 16 $ 16 $ — $ — Interest cost 76 103 5 4 2 3 Expected return on plan assets (127) (175) (13) (10) (5) (6) Amortization and deferrals: Actuarial loss (gain) 14 16 13 11 (4) (3) Prior service benefit — — (1) (1) (2) (3) Net periodic benefit (credit) cost (37) (56) 20 20 (9) (9) Settlement loss — 2 — — — — Total periodic benefit (credit) cost $ (37) $ (54) $ 20 $ 20 $ (9) $ (9) Nine months ended July 31 U.S. Defined Benefit Plans Non-U.S. Defined Benefit Plans Post- Retirement Benefit Plans 2021 2020 2021 2020 2021 2020 In millions Service cost $ — $ — $ 50 $ 47 $ 1 $ 1 Interest cost 228 309 14 13 6 8 Expected return on plan assets (381) (525) (37) (31) (17) (17) Amortization and deferrals: Actuarial loss (gain) 44 48 40 32 (12) (8) Prior service benefit — — (2) (2) (8) (9) Net periodic benefit (credit) cost (109) (168) 65 59 (30) (25) Settlement loss 1 3 — — — — Special termination benefit cost — — — — — 44 Total periodic benefit (credit) cost $ (108) $ (165) $ 65 $ 59 $ (30) $ 19 Employer Contributions and Funding Policy HP’s policy is to fund its pension plans so that it makes at least the minimum contribution required by local government, funding and taxing authorities. During fiscal year 2021, HP anticipates making contributions of approximately $77 million to its non-U.S. pension plans, approximately $34 million to its U.S. non-qualified plan participants and approximately $5 million to cover benefit claims under HP’s post-retirement benefit plans. During the nine months ended July 31, 2021, HP contributed $50 million to its non-U.S. pension plans, paid $21 million to cover benefit payments to U.S. non-qualified plan participants and paid $3 million to cover benefit claims under HP’s post-retirement benefit plans. HP’s pension and other post-retirement benefit costs and obligations depend on various assumptions. Differences between expected and actual returns on investments and changes in discount rates and other actuarial assumptions are reflected as unrecognized gains or losses, and such gains or losses are amortized to earnings in future periods. A deterioration in the funded status of a plan could result in a need for additional company contributions or an increase in net pension and post-retirement benefit costs in future periods. Actuarial gains or losses are determined at the measurement date and amortized over the remaining service life for active plans or the life expectancy of plan participants for frozen plans. |
Taxes on Earnings
Taxes on Earnings | 9 Months Ended |
Jul. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Taxes on Earnings | Taxes on Earnings Provision for Taxes HP’s effective tax rate was 16.5% and 2.2% for the three months ended July 31, 2021 and 2020, respectively, and 14.0% and 11.4% for the nine months ended July 31, 2021 and 2020, respectively. The difference between the U.S. federal statutory tax rate of 21% and HP’s effective tax rate for the three and nine months ended July 31, 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. For the three and nine months ended July 31, 2020, HP’s effective tax rate differed from the U.S. federal statutory rate of 21% primarily due to audit settlements in various jurisdictions 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, 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. During the three and nine months ended July 31, 2020, HP recorded $116 million and $182 million, respectively, of net tax benefits related to discrete items in the provision for taxes. These amounts included tax benefits of $102 million and $143 million related to audit settlements in various jurisdictions, $20 million and $75 million related to restructuring charges, and $4 million and $20 million related to acquisition charges for the three and nine months ended July 31, 2020, respectively. These benefits were partially offset by uncertain tax position charges of $3 million and $54 million for the three and nine months ended July 31, 2020, respectively. For the three and nine months ended July 31, 2020, excess tax benefits associated with stock options, restricted stock units and performance-adjusted restricted stock units were immaterial. Uncertain Tax Positions As of July 31, 2021, the amount of gross unrecognized tax benefits was $822 million, of which up to $653 million would affect HP’s effective tax rate if realized. 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 July 31, 2021 and 2020, HP had accrued $70 million and $37 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 the 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 up to $98 million within the next 12 months, affecting HP’s effective tax rate if realized. HP is subject to income tax in the United States and approximately 60 other countries and is subject to routine corporate income tax audits in many of these jurisdictions. 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. |
Supplementary Financial Informa
Supplementary Financial Information | 9 Months Ended |
Jul. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Supplementary Financial Information | Supplementary Financial Information Accounts Receivable The allowance for credit losses related to accounts receivable and changes were as follows: Nine months ended July 31, 2021 In millions Balance at beginning of period $ 122 Current-period allowance for credit losses 9 Deductions, net of recoveries (14) Balance at end of period $ 117 HP has 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. As these transfers qualify as true sales under the applicable accounting guidance, the receivables are de-recognized from the Consolidated Condensed Balance Sheets upon transfer, and HP receives a payment for the receivables from the third-party within a mutually agreed upon time period. 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 July 31, 2021 and October 31, 2020 were not material. The costs associated with the sale of trade receivables for the three and nine months ended July 31, 2021 and 2020 were not material. The following is a summary of the activity under these arrangements: Three months ended July 31 Nine months ended July 31 2021 2020 2021 2020 In millions Balance at beginning of period (1) $ 212 $ 124 $ 188 $ 235 Trade receivables sold 2,667 2,231 9,155 7,411 Cash receipts (2,711) (2,254) (9,181) (7,544) Foreign currency and other (2) 8 4 7 Balance at end of period (1) $ 166 $ 109 $ 166 $ 109 (1) Amounts outstanding from third parties reported in Accounts receivable in the Consolidated Condensed Balance Sheets. Inventory As of July 31, 2021 October 31, 2020 In millions Finished goods $ 4,187 $ 3,662 Purchased parts and fabricated assemblies (1) 3,978 2,301 $ 8,165 $ 5,963 (1) Increase is attributable to strategic buys in Personal Systems. Other Current Assets As of July 31, 2021 October 31, 2020 In millions Supplier and other receivables $ 2,218 $ 2,092 Prepaid and other current assets 1,031 1,104 Value-added taxes receivable 834 970 Available-for-sale investments 8 274 $ 4,091 $ 4,440 Property, Plant and Equipment, net As of July 31, 2021 October 31, 2020 In millions Land, buildings and leasehold improvements $ 2,168 $ 2,066 Machinery and equipment, including equipment held for lease 5,259 5,275 7,427 7,341 Accumulated depreciation (4,927) (4,714) $ 2,500 $ 2,627 Other Non-Current Assets As of July 31, 2021 October 31, 2020 In millions Deferred tax assets $ 2,581 $ 2,515 Right-of-use assets from operating leases, net 1,114 1,107 Deposits and prepaid 757 337 Intangible assets 741 540 Other 599 527 $ 5,792 $ 5,026 Other Current Liabilities As of July 31, 2021 October 31, 2020 In millions Sales and marketing programs $ 3,101 $ 3,185 Employee compensation and benefit 1,462 1,194 Deferred revenue 1,335 1,208 Other accrued taxes 1,020 1,051 Warranty 752 746 Operating lease liabilities 330 275 Tax liability 271 223 Other 3,284 2,960 $ 11,555 $ 10,842 Other Non-Current Liabilities As of July 31, 2021 October 31, 2020 In millions Pension, post-retirement, and post-employment liabilities $ 1,342 $ 1,576 Deferred revenue 1,043 1,072 Operating lease liabilities 878 904 Tax liability 751 746 Deferred tax liability 47 25 Other 839 823 $ 4,900 $ 5,146 Interest and other, net Three months ended July 31 Nine months ended July 31 2021 2020 2021 2020 In millions Interest expense on borrowings $ (68) $ (55) $ (193) $ (176) Loss on extinguishment of debt (1) (16) (40) (16) (40) Other, net 29 67 103 201 $ (55) $ (28) $ (106) $ (15) (1) See Note 9 “Borrowings” for detailed information. Net revenue by region Three months ended July 31 Nine months ended July 31 2021 2020 2021 2020 In millions Americas $ 7,006 $ 6,229 $ 20,746 $ 17,393 Europe, Middle East and Africa 5,004 4,725 16,267 14,611 Asia-Pacific and Japan 3,279 3,340 9,799 9,377 Total net revenue $ 15,289 $ 14,294 $ 46,812 $ 41,381 Value of Remaining Performance Obligations As of July 31, 2021, the estimated value of transaction price allocated to remaining performance obligations was $3.8 billion. HP expects to recognize approximately $1.8 billion of the unearned amount in next 12 months and $2.0 billion thereafter. HP has elected the practical expedients and accordingly does not disclose the aggregate amount of the transaction price allocated to remaining performance obligations if: • the contract has an original expected duration of one year or less; or • the revenue from the performance obligation is recognized over time on an as-invoiced basis when the amount corresponds directly with the value to the customer; or • the portion of the transaction price that is variable in nature is allocated entirely to a wholly unsatisfied performance obligation. The remaining performance obligations are subject to change and may be affected by various factors, such as termination of contracts, contract modifications and adjustment for currency. Contract Liabilities As of July 31, 2021 and October 31, 2020, HP’s contract liabilities balances were $2.4 billion and $2.2 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, 2021 was primarily driven by sales of fixed-price support and maintenance services, partially offset by $0.9 billion of revenue recognized that was included in the contract liabilities balance as of October 31, 2020. 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 is 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 nine months ended July 31, 2021 and the three and nine months ended July 31, 2020 were immaterial. |
Fair Value
Fair Value | 9 Months Ended |
Jul. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Fair Value | Fair Value Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the measurement date. Fair Value Hierarchy HP uses valuation techniques that are based upon observable and unobservable inputs. Observable inputs are developed using market data such as publicly available information and reflect the assumptions market participants would use, while unobservable inputs are developed using the best information available about the assumptions market participants would use. Assets and liabilities are classified in the fair value hierarchy based on the lowest level input that is significant to the fair value measurement: Level 1—Quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2—Quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability and market-corroborated inputs. Level 3—Unobservable inputs for the asset or liability. The fair value hierarchy gives the highest priority to observable inputs and lowest priority to unobservable inputs. The following table presents HP’s assets and liabilities that are measured at fair value on a recurring basis: As of July 31, 2021 As of October 31, 2020 Fair Value Measured Using Fair Value Measured Using Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total In millions Assets: Cash Equivalents: Corporate debt $ — $ 1,407 $ — $ 1,407 $ — $ 1,700 $ — $ 1,700 Financial institution instruments — — — — — 59 — 59 Government debt (1) 770 — — 770 1,992 181 — 2,173 Available-for-Sale Investments: Corporate debt — — — — — 169 — 169 Financial institution instruments — 8 — 8 — 32 — 32 Government debt (1) — — — — — 73 — 73 Mutual funds 6 57 — 63 5 53 — 58 Derivative Instruments: Interest rate contracts — 2 — 2 — 4 — 4 Foreign currency contracts — 188 — 188 — 191 — 191 Other derivatives — 1 — 1 — — — — Total assets $ 776 $ 1,663 $ — $ 2,439 $ 1,997 $ 2,462 $ — $ 4,459 Liabilities: Derivative Instruments: Interest rate contracts $ — $ 6 $ — $ 6 $ — $ 3 $ — $ 3 Foreign currency contracts — 224 — 224 — 256 — 256 Other derivatives — 1 — 1 — 3 — 3 Total liabilities $ — $ 231 $ — $ 231 $ — $ 262 $ — $ 262 (1) Government debt includes instruments such as U.S. treasury notes, U.S. agency securities and non-U.S. government bonds. Money market funds invested in government debt and traded in active markets are included in Level 1. Valuation Techniques Cash Equivalents and Investments: HP holds time deposits, money market funds, mutual funds, other debt securities primarily consisting of corporate and foreign government notes and bonds, and common stock and equivalents. HP values cash equivalents and equity investments using quoted market prices, alternative pricing sources, including net asset value, or models utilizing market observable inputs. The fair value of debt investments is based on quoted market prices or model-driven valuations using inputs primarily derived from or corroborated by observable market data, and, in certain instances, valuation models that utilize assumptions which cannot be corroborated with observable market data. Derivative Instruments: HP uses industry standard valuation models to measure fair value. Where applicable, these models project future cash flows and discount the future amounts to present value using market-based observable inputs, including interest rate curves, HP and counterparty credit risk, foreign exchange rates, and forward and spot prices for currencies and interest rates. See Note 8, “Financial Instruments” for a further discussion of HP’s use of derivative instruments. Other Fair Value Disclosures Short- and Long-Term Debt: HP estimates the fair value of its debt primarily using an expected present value technique, which is based on observable market inputs using interest rates currently available to companies of similar credit standing for similar terms and remaining maturities and considering its own credit risk. 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 $7.7 billion as of July 31, 2021, compared to its carrying amount of $7.1 billion at that date. The fair value of HP’s short- and long-term debt was $6.7 billion as of October 31, 2020, compared to its carrying value of $6.2 billion at that date. If measured at fair value in the Consolidated Condensed Balance Sheets, short- and long-term debt would be classified in Level 2 of the fair value hierarchy. Other Financial Instruments: For the balance of HP’s financial instruments, primarily accounts receivable, accounts payable and financial liabilities included in Other current liabilities on the Consolidated Condensed Balance Sheets, the carrying amounts approximate fair value due to their short maturities. If measured at fair value in the Consolidated Condensed Balance Sheets, these other financial instruments would be classified as Level 2 or Level 3 in the fair value hierarchy. Non-Marketable Equity Investments and Non-Financial Assets: HP’s non-marketable equity investments are measured at cost less impairment, adjusted for observable price changes. HP’s non-financial assets, such as intangible assets, goodwill and property, plant and equipment, are recorded at fair value in the period an impairment charge is recognized. If measured at fair value in the Consolidated Condensed Balance Sheets these would generally be classified within Level 3 of the fair value hierarchy. |
Financial Instruments
Financial Instruments | 9 Months Ended |
Jul. 31, 2021 | |
Investments, All Other Investments [Abstract] | |
Financial Instruments | Financial Instruments Cash Equivalents and Available-for-Sale Investments As of July 31, 2021 As of October 31, 2020 Cost Gross Unrealized Gain Gross Unrealized Loss Fair Value Cost Gross Unrealized Gain Gross Unrealized Loss Fair Value In millions Cash Equivalents: Corporate debt $ 1,407 $ — $ — $ 1,407 $ 1,700 $ — $ — $ 1,700 Financial institution instruments — — — — 59 — — 59 Government debt 770 — — 770 2,173 — — 2,173 Total cash equivalents 2,177 — — 2,177 3,932 — — 3,932 Available-for-Sale Investments: Corporate debt (1) — — — — 169 — — 169 Financial institution instruments (1) 8 — — 8 32 — — 32 Government debt (1) — — — — 73 — — 73 Mutual funds 44 19 — 63 42 16 — 58 Total available-for-sale investments 52 19 — 71 316 16 — 332 Total cash equivalents and available-for-sale investments $ 2,229 $ 19 $ — $ 2,248 $ 4,248 $ 16 $ — $ 4,264 (1) HP classifies its marketable debt securities as Available-for-sale investments within Other current assets on the Consolidated Condensed Balance Sheets, including those with maturity dates beyond one year, based on their highly liquid nature and availability for use in current operations. All highly liquid investments with original maturities of three months or less at the date of acquisition are considered cash equivalents. As of July 31, 2021 and October 31, 2020, 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 July 31, 2021 Amortized Fair Value In millions Due in one year $ 8 $ 8 Non-marketable equity securities in privately held companies are included in Other non-current assets in the Consolidated Condensed Balance Sheets. These amounted to $53 million and $44 million as of July 31, 2021 and October 31, 2020, 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 nine months ended July 31, 2021. Derivative Instruments HP uses derivatives to offset business exposure to foreign currency and interest rate risk on expected future cash flows and on certain existing assets and liabilities. As part of its risk management strategy, HP uses derivative instruments, primarily forward contracts, interest rate swaps, total return swaps, treasury rate locks, forward starting swaps and, at times, option contracts to hedge certain foreign currency, interest rate and, return on certain investment exposures. HP may designate its derivative contracts as fair value hedges or cash flow hedges and classifies the cash flows with the activities that correspond to the underlying hedged items. Additionally, for derivatives not designated as hedging instruments, HP categorizes those economic hedges as other derivatives. 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 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 $95 million and $90 million as of July 31, 2021 and as of October 31, 2020, respectively, all of which were fully collateralized within two 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 July 31, 2021 and October 31, 2020. Fair Value Hedges HP enters into fair value hedges, such as interest rate swaps, to reduce the exposure of its debt portfolio to changes in fair value resulting from changes in benchmark interest rates on HP’s future interest rate payments. For derivative instruments that are designated and qualify as fair value hedges, HP recognizes the change 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. During the nine months ended July 31, 2021, HP entered into interest rate swaps with a notional amount of $375 million that were designated as fair value hedges, to convert a portion of its fixed-rate debt to floating. HP terminated interest rate swaps with a notional amount of $500 million that were de-designated as fair value hedges including $250 million notional amount related to certain fixed-rate debt securities that were extinguished, resulting in an immaterial loss. Cash Flow Hedges HP uses forward contracts, treasury rate locks, forward starting swaps and, at times, option contracts designated as cash flow hedges to protect against the foreign currency exchange and interest rate risks inherent in its forecasted net revenue, cost of revenue, operating expenses and debt issuance. HP’s foreign currency cash flow hedges mature predominantly within twelve months; however, hedges related to long-term procurement arrangements extend several years. For derivative instruments that are designated and qualify as cash flow hedges, HP initially records changes in fair value of the derivative instrument in Accumulated other comprehensive loss as a separate component of stockholders’ deficit in the Consolidated Condensed Balance Sheets and subsequently reclassifies these amounts into earnings in the period during which the hedged transaction is recognized in earnings. 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. During the nine months ended July 31, 2021, HP entered into a series of forward starting swap agreements with notional amounts totaling $1.75 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. These agreements were designated as cash flow hedges. In June 2021, a series of these forward starting swaps totaling $750 million notional amount were settled upon the issuance of the senior notes resulting in an immaterial loss recognized in Accumulated other comprehensive loss. The loss will be reclassified to Interest and other, net over the life of the related debt. Other Derivatives Other derivatives not designated as hedging instruments consist primarily of forward contracts used to hedge foreign currency-denominated balance sheet exposures. HP also uses total return swaps to hedge its executive deferred compensation plan liability. 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. Hedge Effectiveness For interest rate swaps designated as fair value hedges, HP measures hedge effectiveness by offsetting the change in fair value of the hedged item with the change in fair value of the derivative. 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 nine months ended July 31, 2021 and 2020, 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 Gross notional and fair value of derivative instruments in the Consolidated Condensed Balance Sheets were as follows: As of July 31, 2021 As of October 31, 2020 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 In millions Derivatives designated as hedging instruments Fair value hedges: Interest rate contracts $ 750 $ — $ 2 $ — $ 6 $ 875 $ 4 $ — $ — $ 3 Cash flow hedges: Foreign currency contracts 16,531 142 32 135 47 15,661 148 30 199 37 Interest rate contracts 1,000 — — — 27 — — — — — Total derivatives designated as hedging instruments 18,281 142 34 135 80 16,536 152 30 199 40 Derivatives not designated as hedging instruments Foreign currency contracts 5,519 14 — 15 — 5,319 13 — 20 — Other derivatives 155 1 — 1 — 142 — — 3 — Total derivatives not designated as hedging instruments 5,674 15 — 16 — 5,461 13 — 23 — Total derivatives $ 23,955 $ 157 $ 34 $ 151 $ 80 $ 21,997 $ 165 $ 30 $ 222 $ 40 Offsetting of Derivative Instruments HP recognizes all derivative instruments on a gross basis in the Consolidated Condensed Balance Sheets. 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 July 31, 2021 and October 31, 2020, information related to the potential effect of HP’s master netting agreements and collateral security agreements was as follows: In the Consolidated Condensed Balance Sheets Gross Amounts Not Offset Gross Amount Gross Amount Net Amount Derivatives Financial Net Amount In millions As of July 31, 2021 Derivative assets $ 191 $ — $ 191 $ 133 $ 34 (1) $ 24 Derivative liabilities $ 231 $ — $ 231 $ 133 $ 75 (2) $ 23 As of October 31, 2020 Derivative assets $ 195 $ — $ 195 $ 156 $ 4 (1) $ 35 Derivative liabilities $ 262 $ — $ 262 $ 156 $ 130 (2) $ (24) (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 (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 Effect of Derivative Instruments in the Consolidated Condensed Statements of Earnings The pre-tax effect of derivative instruments and related hedged items in a fair value hedging relationship were as follows: 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 In millions Three months ended July 31 Interest rate contract Fixed-rate debt Interest and other, net 2021 $ (55) $ 5 $ (5) 2020 $ (28) $ 1 $ (1) Nine months ended July 31 Interest rate contract Fixed-rate debt Interest and other, net 2021 $ (106) $ (5) $ 5 2020 $ (15) $ 11 $ (11) The pre-tax effect of derivative instruments in cash flow hedging relationships included in Accumulated other comprehensive loss was as follows: Three months ended July 31 Nine months ended July 31 2021 2020 2021 2020 In millions Gain/(loss) recognized in Accumulated other comprehensive loss on derivatives: Foreign currency contracts $ 167 $ (567) $ (220) $ (268) Interest rate contracts $ (34) $ 4 $ (34) $ (4) The pre-tax effect of derivative instruments in cash flow hedging relationships included in earnings were as follows: Total amounts of income/(expense) line items in the statement of financial performance in which the effects of cash flow hedges are recorded Gain/(loss) reclassified from Accumulated Three months ended July 31 Nine months ended July 31 Three months ended July 31 Nine months ended July 31 2021 2020 2021 2020 2021 2020 2021 2020 In millions Net revenue $ 15,289 $ 14,294 $ 46,812 $ 41,381 $ (57) $ 136 $ (246) $ 259 Cost of revenue (11,901) (11,901) (36,660) (33,623) (7) (7) (17) (18) Other operating expenses (2,007) (1,614) (6,088) (5,288) — 1 1 1 Interest and other, net (55) (28) (106) (15) — — — — Total $ 1,326 $ 751 $ 3,958 $ 2,455 $ (64) $ 130 $ (262) $ 242 As of July 31, 2021, HP expects to reclassify an estimated accumulated other comprehensive loss of $40 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 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 nine months ended July 31, 2021 and 2020 was as follows: Gain/(loss) recognized in earnings on derivative instrument Three months ended July 31 Nine months ended July 31 Location 2021 2020 2021 2020 In millions Foreign currency contracts Interest and other, net $ (33) $ 46 $ (42) $ 63 Other derivatives Interest and other, net (2) 11 4 16 Total $ (35) $ 57 $ (38) $ 79 |
Borrowings
Borrowings | 9 Months Ended |
Jul. 31, 2021 | |
Debt Disclosure [Abstract] | |
Borrowings | Borrowings Notes Payable and Short-Term Borrowings As of July 31, 2021 As of October 31, 2020 Amount Weighted-Average Amount Weighted-Average In millions Current portion of long-term debt $ 181 3.3 % $ 633 4.0 % Notes payable to banks, lines of credit and other 33 1.6 % 41 1.6 % $ 214 $ 674 Long-Term Debt As of July 31, 2021 October 31, 2020 In millions U.S. Dollar Global Notes (1) 2009 Shelf Registration Statement: $1,000 issued at discount to par at a price of 99.816% in September 2011 at 4.375%, due September 2021 $ — $ 412 $1,500 issued at discount to par at a price of 99.707% in December 2011 at 4.65%, due December 2021 — 586 $500 issued at discount to par at a price of 99.771% in March 2012 at 4.05%, due September 2022 499 499 $1,200 issued at discount to par at a price of 99.863% in September 2011 at 6.00%, due September 2041 1,199 1,199 2019 Shelf Registration Statement: $1,150 issued at discount to par at a price of 99.769% in June 2020 at 2.2%, due June 2025 1,148 1,148 $1,000 issued at discount to par at a price of 99.718% in June 2020 at 3.0%, due June 2027 997 997 $850 issued at discount to par at a price of 99.790% in June 2020 at 3.4%, due June 2030 848 848 $1,000 issued at discount to par at a price of 99.808% in June 2021 at 1.45%, due June 2026 999 — $1,000 issued at discount to par at a price of 99.573% in June 2021 at 2.65%, due June 2031 996 — 6,686 5,689 Other borrowings at 0.51-9.00%, due in calendar years 2021-2028 451 522 Fair value adjustment related to hedged debt (2) 2 Unamortized debt issuance cost (56) (37) Current portion of long-term debt (181) (633) Total long-term debt $ 6,898 $ 5,543 (1) HP may redeem some or all of the fixed-rate U.S. Dollar Global Notes at any time in accordance with the terms thereof. The U.S. Dollar Global Notes are senior unsecured debt. In June 2021, HP completed its offering of $2.0 billion aggregate principal amount of senior unsecured notes, consisting of $1.0 billion of 1.450% notes due June 2026 (the “2026 Notes”), and $1.0 billion of 2.650% notes due June 2031 (the “2031 Notes”). HP incurred issuance costs of $17 million. HP will pay interest semi-annually on the notes on June 17 and December 17, beginning December 17, 2021. In June 2021, HP terminated a series of forward starting swap agreements with notional amounts totaling $750 million that were executed to mitigate the treasury rate volatility associated with this debt issuance. The net proceeds from the 2026 Notes were used for general corporate purposes, including redemption of existing notes maturing in 2021, as described below. HP intends to allocate an amount equal to the net proceeds of the 2031 Notes to finance or refinance, in whole or in part, environmentally and socially responsible eligible projects in the following eight areas: renewable energy; green buildings; energy efficiency; clean transportation; pollution prevention and control; eco-efficient and/or circular economy products, production technologies and processes; environmentally sustainable management of living natural resources and land use; and socioeconomic advancement and empowerment. As disclosed in Note 8, “Financial Instruments”, HP uses interest rate swaps to mitigate some of the exposure of its debt portfolio to changes in fair value resulting from changes in benchmark interest rates. Interest rates shown in the table of long-term debt have not been adjusted to reflect the impact of any interest rate swaps. Extinguishment of debt In July 2021, HP redeemed the remaining aggregate principal amounts of $0.4 billion in outstanding U.S. Dollar 4.375% Global Notes due September 15, 2021 and $0.6 billion in outstanding U.S. Dollar 4.650% Global Notes due December 9, 2021. This extinguishment of debt resulted in a net loss of $16 million, which was recorded as Interest and other, net on the Consolidated Condensed Statements of Earnings. As part of the above transactions, HP terminated and settled interest rate swaps with a notional amount of $250 million that were de-designated as fair value hedges. Commercial Paper As of July 31, 2021, HP maintained two commercial paper programs. HP’s U.S. program provides for the issuance of U.S. dollar-denominated commercial paper up to a maximum aggregate principal amount of $6.0 billion. HP’s euro commercial paper program provides for the issuance of commercial paper outside of the United States denominated in U.S. dollars, euros or British pounds up to a maximum aggregate principal amount of $6.0 billion or the equivalent in those alternative currencies. The combined aggregate principal amount of commercial paper outstanding under those programs at any one time cannot exceed the $6.0 billion authorized by HP’s Board of Directors. Credit Facilities As of July 31, 2021, HP maintained a $5.0 billion sustainability-linked senior unsecured committed revolving credit facility (the “New Revolving Facility”), which HP entered into on May 26, 2021. Commitments under the New Revolving Facility will be available until May 26, 2026. HP had maintained a $4.0 billion senior unsecured committed revolving credit facility and a $1.0 billion 364-day revolving credit facility to support the issuance of commercial paper or for general corporate purposes. Commitments under the $4.0 billion and $1.0 billion revolving credit facilities were terminated concurrently with the execution of the New Revolving Facility. Commitment fees, interest rates and other terms of borrowing under the New Revolving Facility vary based on HP’s external credit ratings and certain sustainability metrics. Funds borrowed under the New Revolving Facility may be used for general corporate purposes. As of July 31, 2021, HP was in compliance with the financial covenants in the credit agreement governing the New Revolving Facility. Available Borrowing Resources As of July 31, 2021, HP had available borrowing resources of $575 million from uncommitted lines of credit in addition to the New Revolving Facility. |
Stockholders' Deficit
Stockholders' Deficit | 9 Months Ended |
Jul. 31, 2021 | |
Stockholders' Equity Note [Abstract] | |
Stockholders' Deficit | Stockholders’ Deficit Share Repurchase Program HP’s share repurchase program authorizes both open market and private repurchase transactions. During the three and nine months ended July 31, 2021, HP executed share repurchases of 50 million shares and 163 million shares and settled total shares for $1.5 billion and $4.5 billion, respectively. During the three and nine months ended July 31, 2020, HP executed share repurchases of 59 million shares and 97 million shares and settled total shares for $1.0 billion and $1.8 billion, respectively. Share repurchases executed during the three and nine months ended July 31, 2021 and 2020 included 1.8 million and 2.8 million shares settled in August 2021 and 2020, respectively. The shares repurchased during the nine months ended July 31, 2021 and 2020 were all open market repurchase transactions. As of July 31, 2021, HP had approximately $8.2 billion remaining under the share repurchase authorizations approved by HP’s Board of Directors. Tax effects related to Other Comprehensive Income (Loss) Three months ended July 31 Nine months ended July 31 2021 2020 2021 2020 In millions Tax effect on change in unrealized components of available-for-sale debt securities: Tax provision on unrealized gains arising during the period $ — $ — $ (1) $ — Tax effect on change in unrealized components of cash flow hedges: Tax (provision) benefit on unrealized gains (losses) arising during the period (22) 83 18 34 Tax (benefit) provision on losses (gains) reclassified into earnings (4) 25 (25) 51 (26) 108 (7) 85 Tax effect on change in unrealized components of defined benefit plans: Tax benefit (provision) on (losses) gains arising during the period — 1 (11) 1 Tax benefit on amortization of actuarial loss and prior service benefit (4) (5) (14) (15) (4) (4) (25) (14) Tax effect on change in cumulative translation adjustment (2) — (8) — Tax (provision) benefit on other comprehensive income (loss) $ (32) $ 104 $ (41) $ 71 Changes and reclassifications related to Other Comprehensive Income (Loss), net of taxes Three months ended July 31 Nine months ended July 31 2021 2020 2021 2020 In millions Other comprehensive income (loss), net of taxes: Change in unrealized components of available-for-sale debt securities: Unrealized gains arising during the period $ 1 $ 2 $ 4 $ 1 Change in unrealized components of cash flow hedges: Unrealized gains (losses) arising during the period 111 (480) (236) (238) Losses (gains) reclassified into earnings 60 (105) 237 (191) 171 (585) 1 (429) Change in unrealized components of defined benefit plans: (Losses) gains arising during the period (1) (4) 29 (5) Amortization of actuarial loss and prior service benefit (1) 16 15 48 46 Curtailments, settlements and other — 2 1 3 15 13 78 44 Change in cumulative translation adjustment — 15 27 4 Other comprehensive income (loss), net of taxes $ 187 $ (555) $ 110 $ (380) (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”. The components of Accumulated other comprehensive loss, net of taxes and changes were as follows: Nine months ended July 31, 2021 Net unrealized Net unrealized (losses) gains on cash Unrealized Change in cumulative Accumulated In millions Balance at beginning of period $ 11 $ (66) $ (1,190) $ 2 $ (1,243) Other comprehensive income (loss) before reclassifications 4 (236) 29 27 (176) Reclassifications of losses into earnings — 237 48 — 285 Reclassifications of settlements into earnings — — 1 — 1 Balance at end of period $ 15 $ (65) $ (1,112) $ 29 $ (1,133) |
Net Earnings Per Share
Net Earnings Per Share | 9 Months Ended |
Jul. 31, 2021 | |
Earnings Per Share [Abstract] | |
Net Earnings Per Share | Net Earnings Per Share HP calculates basic net EPS using net earnings and the weighted-average number of shares outstanding during the reporting period. Diluted net EPS includes any dilutive effect of restricted stock units, stock options, performance-based awards and shares purchased under the 2021 employee stock purchase plan. A reconciliation of the number of shares used for basic and diluted net EPS calculations is as follows: Three months ended July 31 Nine months ended July 31 2021 2020 2021 2020 In millions, except per share amounts Numerator: Net earnings $ 1,108 $ 734 $ 3,404 $ 2,176 Denominator: Weighted-average shares used to compute basic net EPS 1,185 1,417 1,235 1,435 Dilutive effect of employee stock plans 14 6 12 6 Weighted-average shares used to compute diluted net EPS 1,199 1,423 1,247 1,441 Net earnings per share: Basic $ 0.94 $ 0.52 $ 2.76 $ 1.52 Diluted $ 0.92 $ 0.52 $ 2.73 $ 1.51 Anti-dilutive weighted-average stock-based compensation awards (1) — 15 2 13 (1) HP excludes from the calculation of diluted net EPS stock options and restricted stock units where the assumed proceeds exceed the average market price, because their effect would be anti-dilutive. The assumed proceeds of a stock option include the sum of its exercise price, and average unrecognized compensation cost. The assumed proceeds of a restricted stock unit represent unrecognized compensation cost. |
Litigation and Contingencies
Litigation and Contingencies | 9 Months Ended |
Jul. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Litigation and Contingencies | Litigation and Contingencies HP is involved in lawsuits, claims, investigations and proceedings, including those identified below, consisting of IP, commercial, securities, employment, employee benefits and environmental matters that arise in the ordinary course of business. 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 July 31, 2021, 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. Pursuant to the separation and distribution agreement, HP shares responsibility with Hewlett Packard Enterprise for certain matters, as indicated below, and Hewlett Packard Enterprise has agreed to indemnify HP in whole or in part with respect to certain matters. Based on its experience, HP believes that any damage amounts claimed in the specific matters discussed below are not a meaningful indicator of HP’s potential liability. Litigation is inherently unpredictable. However, HP believes it has valid defenses with respect to legal matters pending against it. Nevertheless, cash flows or results of operations could be materially affected in any particular period by the resolution of one or more of these contingencies. Litigation, Proceedings and Investigations Copyright Levies . Proceedings are ongoing or have been concluded involving HP in certain European countries, including litigation in Belgium and other countries, seeking to impose or modify levies upon IT equipment (such as multifunction devices (“MFDs”) and PCs), alleging that these devices enable the production of private copies of copyrighted materials. The levies are generally based upon the number of products sold and the per-product amounts of the levies, which vary. Some European countries that do not yet have levies on digital devices are expected to implement similar legislation to enable them to extend existing levy schemes, while other European countries have phased out levies or are expected to limit the scope of levy schemes and applicability in the digital hardware environment, particularly with respect to sales to business users. HP, other companies and various industry associations have opposed the extension of levies to the digital environment and have advocated alternative models of compensation to rights holders. Reprobel SCRL (“Reprobel”), a collecting society administering the remuneration for reprography to Belgian copyright holders, requested by extrajudicial means that HP amend certain copyright levy declarations submitted for inkjet MFDs sold in Belgium from January 2005 to December 2009 to enable it to collect copyright levies calculated based on the generally higher copying speed when the MFDs are operated in draft print mode rather than when operated in normal print mode. In March 2010, HP filed a lawsuit against Reprobel in the Brussels Court of First Instance in Belgium, seeking a declaratory judgment that no copyright levies are payable on sales of MFDs in Belgium or, alternatively, that payments already made by HP are sufficient to comply with its obligations. The Brussels Court of Appeal (the “Court of Appeal”) stayed the proceedings and referred several questions to the Court of Justice of the European Union (“CJEU”). On November 12, 2015, the CJEU published its judgment providing that a national legislation such as the Belgian one at issue in the main proceedings is incompatible with EU law on multiple legal points, as argued by HP, and returned the proceedings to the referring court. On May 12, 2017, the Court of Appeal held that (1) reprographic copyright levies are due notwithstanding the lack of conformity of the Belgian system with EU law in certain aspects and (2) the applicable levies are to be calculated based on the objective speed of each MFD as established by an expert appointed by the Court of Appeal. HP appealed this decision before the Belgian Supreme Court on January 18, 2018. The Belgian Supreme Court rejected HP’s appeal on September 24, 2020 and the matter has been remitted to the Court of Appeal, where the expert will give an opinion on the objective speed and amount of compensation due. Under a settlement agreement executed on June 16, 2021 HP and Reprobel have resolved all ongoing disputes in relation to the Belgian copyright exceptions system that was applicable until December 2016, when the relevant provisions of the copyright law were abolished. Hewlett-Packard Company v. Oracle Corporation . On June 15, 2011, HP filed suit against Oracle Corporation (“Oracle”) in California Superior Court in Santa Clara County in connection with Oracle’s March 2011 announcement that it was discontinuing software support for HP’s Itanium-based line of mission-critical servers. HP asserted, among other things, that Oracle’s actions breached the contract that was signed by the parties as part of the settlement of the litigation relating to Oracle’s hiring of Mark Hurd. The matter eventually progressed to trial, which was bifurcated into two phases. HP prevailed in the first phase of the trial, in which the court ruled that the contract at issue required Oracle to continue to offer its software products on HP’s Itanium-based servers for as long as HP decided to sell such servers. The second phase of the trial was then postponed by Oracle’s appeal of the trial court’s denial of Oracle’s “anti-SLAPP” motion, in which Oracle argued that HP’s damages claim infringed on Oracle’s First Amendment rights. On August 27, 2015, the California Court of Appeals rejected Oracle’s appeal. The matter was remanded to the trial court for the second phase of the trial, which began on May 23, 2016 and was submitted to the jury on June 29, 2016. On June 30, 2016, 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. On October 20, 2016, the court entered judgment for HP for this amount with interest accruing until the judgment is paid. Oracle’s motion for new trial was denied on December 19, 2016, and Oracle filed its notice of appeal from the trial court’s judgment on January 17, 2017. On February 2, 2017, HP filed a notice of cross-appeal challenging the trial court’s denial of prejudgment interest. Oral argument in front of the Court of Appeals was held on May 27, 2021. On June 14, 2021, the Court of Appeals affirmed both the trial court’s judgment and its denial of prejudgment interest to HP. On July 26, 2021, Oracle filed a petition with the California Supreme Court for review, which HP answered on August 16, 2021. Litigation is unpredictable, and there can be no assurance that HP will recover damages, or that any award of damages will be for the amount awarded by the jury’s verdict. The amount ultimately awarded, if any, would be recorded in the period received. No adjustment has been recorded in the financial statements in relation to this potential award. Pursuant to the terms of the separation and distribution agreement, HP and Hewlett Packard Enterprise will share equally in any recovery from Oracle once Hewlett Packard Enterprise has been reimbursed for all costs incurred in the prosecution of the action prior to the Separation. Forsyth, et al. v. HP Inc. and Hewlett Packard Enterprise . This is a purported class and collective action filed on August 18, 2016 in the United States District Court, Northern District of California, against HP and Hewlett Packard Enterprise alleging the defendants violated the Federal Age Discrimination in Employment Act (“ADEA”), the California Fair Employment and Housing Act, California public policy and the California Business and Professions Code by terminating older workers and replacing them with younger workers. The operative complaint is the Fourth Amended Complaint, filed in July 2020. By their complaint, plaintiffs seek to represent (1) a putative nationwide ADEA collective comprised of all individuals 40 years of age and older who had their employment terminated pursuant to a WFR plan on or after December 9, 2014 or April 8, 2015, depending on state law; and (2) a putative Rule 23 class under California law comprised of all individuals 40 years of age and older who had their employment terminated in California pursuant to a WFR plan on or after August 18, 2012. Excluded from the putative collective and class are employees who (a) signed a Waiver and General Release Agreement at termination, or (b) signed an Agreement to Arbitrate Claims. A similar purported collective and class are proposed for Hewlett Packard Enterprise, but the periods start on November 1, 2015. Plaintiffs seek monetary damages in the form of back and front pay and benefits, liquidated damages under the ADEA, punitive damages under the state law claims, an award of attorneys’ fees, and other relief. In December 2020, plaintiffs filed a motion for preliminary certification of the putative nationwide ADEA collectives, and the Court granted this motion on April 13, 2021. As a result, potential members of the ADEA collectives will be notified of their right to opt into the case to join the current thirty-six named and opt-in plaintiffs. India Directorate of Revenue Intelligence Proceedings . On April 30 and May 10, 2010, the India Directorate of Revenue Intelligence (the “DRI”) issued show cause notices to Hewlett-Packard India Sales Private Limited (“HP India”), a subsidiary of HP, seven HP India employees and one former HP India employee alleging that HP India underpaid customs duties while importing products and spare parts into India and seeking to recover an aggregate of approximately $370 million, plus penalties. Prior to the issuance of the show cause notices, HP India deposited approximately $16 million with the DRI and agreed to post a provisional bond in exchange for the DRI’s agreement to not seize HP India products and spare parts and to not interrupt the transaction of business by HP India. On April 11, 2012, the Bangalore Commissioner of Customs issued an order on the products-related show cause notice affirming certain duties and penalties against HP India and the named individuals of approximately $386 million, of which HP India had already deposited $9 million. On December 11, 2012, HP India voluntarily deposited an additional $10 million in connection with the products-related show cause notice. The differential duty demand is subject to interest. On April 20, 2012, the Commissioner issued an order on the parts-related show cause notice affirming certain duties and penalties against HP India and certain of the named individuals of approximately $17 million, of which HP India had already deposited $7 million. After the order, HP India deposited an additional $3 million in connection with the parts-related show cause notice so as to avoid certain penalties. HP India filed appeals of the Commissioner’s orders before the Customs, Excise and Service Tax Appellate Tribunal (the “Customs Tribunal”) along with applications for waiver of the pre-deposit of remaining demand amounts as a condition for hearing the appeals. The Customs Department has also filed cross-appeals before the Customs Tribunal. On January 24, 2013, the Customs Tribunal ordered HP India to deposit an additional $24 million against the products order, which HP India deposited in March 2013. The Customs Tribunal did not order any additional deposit to be made under the parts order. In December 2013, HP India filed applications before the Customs Tribunal seeking early hearing of the appeals as well as an extension of the stay of deposit as to HP India and the individuals already granted until final disposition of the appeals. On February 7, 2014, the application for extension of the stay of deposit was granted by the Customs Tribunal until disposal of the appeals. On October 27, 2014, the Customs Tribunal commenced hearings on the cross-appeals of the Commissioner’s orders. The Customs Tribunal rejected HP India’s request to remand the matter to the Commissioner on procedural grounds. The hearings scheduled to reconvene on April 6, 2015 and again on November 3, 2015 and April 11, 2016 were cancelled at the request of the Customs Tribunal. A hearing scheduled for January 15, 2019 was cancelled. On January 20, 2021, the Customs Tribunal held a virtual hearing during which the judge allowed HP’s application for a physical hearing on the merits as soon as practicable, which will be scheduled when physical hearings resume at court. Pursuant to the separation and distribution agreement, Hewlett Packard Enterprise has agreed to indemnify HP in part, based on the extent to which any liability arises from the products and spare parts of Hewlett Packard Enterprise’s businesses. Slingshot Printing LLC Litigation . On June 11, 2019, Slingshot Printing LLC (“Slingshot”) filed three complaints in U.S. District Court in the Western District of Texas alleging HP infringes or has infringed sixteen patents. On September 20, 2019, Slingshot filed a fourth complaint and amended the three earlier complaints, alleging that HP infringes or has infringed thirty-two patents. On December 12, 2019, Slingshot voluntarily dismissed its allegations as to one patent because it did not own a related patent. On January 23, 2020, Slingshot filed a fifth complaint, re-asserting the dismissed patent as well as the related patent. On February 13, 2020, Slingshot voluntarily dismissed its allegations as to another patent, which was asserted in its third complaint. On March 25, 2020, Slingshot voluntarily dismissed its allegations as to an additional patent, which was also asserted in its third complaint. The five complaints assert a total of 31 patents and seek monetary damages. The accused products include inkjet printers, cartridges, and printheads. In December 2020, HP received notice that in September 2020, Slingshot filed two actions in China’s Guangzhou IP Specialized Court that had been removed to Guangdong High Court. The Guangzhou cases assert two patents related to patents in the U.S. litigation. On January 14, 2021, the U.S. Patent and Trademark Office Patent Trial and Appeal Board granted HP’s petitions to challenge the validity of four Slingshot patents and instituted inter partes review. On January 31, 2021, HP and Slingshot entered into an agreement to resolve all litigation. The U.S. civil actions and Guangzhou cases have been dismissed and HP’s petitions have been terminated. Philips Patent Litigation . On September 17, 2020, Koninklijke Philips N.V. and Philips North America LLC (collectively, “Philips”) filed a complaint against HP for patent infringement in federal court for the District of Delaware. On September 18, 2020, Philips filed a companion complaint with the U.S. International Trade Commission (“ITC”) pursuant to Section 337 of the Tariff Act of 1930 against HP and 8 other sets of respondents. Both the district court complaint and the ITC complaint allege that certain digital video-capable devices and components thereof infringe four of Philips owned patents. On October 16, 2020, the ITC instituted an investigation, and on July 19, 2021, the ITC held an evidentiary trial that concluded on July 23, 2021. The ITC is expected to render an initial determination by October 22, 2021, and a final decision by February 22, 2022. In the ITC proceeding, Philips seeks an order enjoining respondents from importing, or selling after importation, certain digital video-capable devices and components thereof, including certain PCs, display devices, and components thereof. In the district court case, Philips seeks unspecified damages and an injunction against HP, among other remedies. The district court case has been stayed pending resolution of the ITC proceeding. Caltech Patent Litigation . On November 11, 2020, the California Institute of Technology (“Caltech”) filed a complaint against HP for patent infringement in the federal court for the Western District of Texas. On March 19, 2021, Caltech filed an amendment to this same complaint. The complaint as amended alleges infringement of five of Caltech’s patents, U.S. Patent Nos. 7,116,710; 7,421,032; 7,716,552; 7,916,781; and 8,284,833. The accused products are HP commercial and consumer PCs as well as wireless printers that comply with the IEEE 802.11n, 802.11ac, and/or 802.11ax standards. Caltech seeks unspecified damages and other relief. The court has stayed the case pending the decision by the U.S. Court of Appeals for the Federal Circuit in The California Inst. of Tech. v. Broadcom Ltd et al. , Case No. 2020-2222. In re HP Inc. Securities Litigation (Electrical Workers Pension Fund, Local 103, I.B.E.W. v. HP Inc., et al.) . On February 19, 2020, Electrical Workers Pension Fund, Local 103, I.B.E.W. filed a putative class action complaint against HP, Dion Weisler, Catherine Lesjak, and Steven Fieler in U.S. District Court in the Northern District of California. On May 20, 2020, the court appointed the State of Rhode Island, Office of the General Treasurer, on behalf of the Employees’ Retirement System of Rhode Island and Iron Workers Local 580 Joint Funds as Lead Plaintiffs. On July 20, 2020, Lead Plaintiffs filed an amended complaint, which additionally named as defendants Enrique Lores and Christoph Schell. On October 2, 2020, HP and the named officers filed a motion to dismiss the complaint for failure to state a claim upon which relief can be granted. On March 19, 2021, the court granted HP’s motion to dismiss and granted plaintiffs leave to amend the complaint. On May 3, 2021, plaintiffs filed their second amended complaint, which no longer names Christoph Schell as a defendant. The second amended complaint alleges, among other things, that from February 23, 2017 to October 3, 2019, HP and the named officers violated Sections 10(b) and 20(a) of the Exchange Act by making false or misleading statements about HP’s printing supplies business, including alleged statements made about changes to HP’s channel inventory management and sales practices, and stabilization of printing supplies revenue. It further alleges that Dion Weisler and Enrique Lores violated Sections 10(b) and 20A of the Exchange Act by allegedly selling shares of HP common stock during this period while in possession of material, non-public adverse information about HP’s printing supplies business. Plaintiffs seek compensatory damages and other relief. On June 4, 2021, HP and the named officers filed a motion to dismiss the second amended complaint for failure to state a claim upon which relief can be granted. The motion is fully briefed and oral argument in front of the court is scheduled for September 9, 2021. York County on behalf of the County of York Retirement Fund v. HP Inc., et al., and related proceedings. On November 5, 2020, York County, on behalf of the County of York Retirement Fund, filed a putative class action complaint against HP, Dion Weisler, and Catherine Lesjak in federal court in the Northern District of California. On February 11, 2021, the court appointed Maryland Electrical Industry Pension Fund as Lead Plaintiff. On April 21, 2021, Lead Plaintiff filed a consolidated complaint, which additionally names as defendants Enrique Lores and Richard Bailey. 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, including information about HP’s channel inventory management and sales practices. Plaintiff seeks compensatory damages and other relief. On June 21, 2021, HP and the named officers filed a motion to dismiss the complaint for failure to state a claim upon which relief can be granted. That motion is anticipated to be fully briefed on October 4, 2021. 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 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. The derivative plaintiff seeks compensatory damages, governance reforms, and other relief. By court order following stipulations by the parties, the case was transferred to the Northern District of California on June 22, 2021, and on July 1, 2021, the case was stayed pending a ruling on the motion to dismiss in York County . Legal Proceedings re Authentication of Supplies . Civil litigation or government investigations are pending in the United States, Italy, Israel, and the Netherlands involving supplies authentication protocols used in certain HP printers. These protocols are often referred to as Dynamic Security. The core allegations in these proceedings claim misleading or inadequate consumer notifications and permissions pertaining to the use of Dynamic Security, the impact of firmware updates, or the potential inability of cartridges with clone chips or circuitry to work in HP printers with Dynamic Security. 123Inkt Foundation litigation (Netherlands) . On November 23, 2016, a foundation known as Stichting 123Inkt-Huismerk Klanten (the “Foundation”) filed a complaint in district court in Amsterdam against HP Nederland B.V. and HP Inc. arising out of the use of Dynamic Security in certain OfficeJet printers. Digital Revolution B.V. (a.k.a. 123Inkt) established the Foundation to pursue the interests of approximately 960 of its customers who transferred their claims to it. The complaint alleges: (1) violation of right of ownership; (2) destruction and damage to property; (3) computer vandalism; (4) unlawful act; (5) non-compliance; (6) unfair commercial practices; (7) misleading commercial practices; and (8) misleading advertising. The complaint seeks injunctive relief to prohibit use of Dynamic Security, damages, and attorneys’ fees. On December 27, 2017, the District Court dismissed the case and awarded fees to HP. On January 25, 2018, the Foundation filed a summons with the Amsterdam Court of Appeal to appeal. On December 17, 2019, the Court of Appeal set aside the judgment of the District Court, adopted a new decision declaring that HP provided inadequate and partially incorrect information to the Foundation members around September 13, 2016, awarded damages to them in an amount to be later determined, but denied all other claims, including injunctive relief, holding that the use of Dynamic Security is not inherently impermissible and the Foundation lacks legal interest to pursue such action. On March 19, 2020, the Foundation filed a cassation writ of summons with the Supreme Court of the Netherlands (Hoge Raad der Nederlanden) appealing the decision of the Court of Appeal. On May 29, 2020, HP filed its statement of defense and incidental appeal in cassation with the Supreme Court appealing the decision of the Court of Appeal. The Attorney General issued a non-binding opinion on July 9, 2021 concluding that both parties’ appeals should be rejected. The Supreme Court has scheduled its final decision to be delivered on January 7, 2022. Gensin v. HP Inc. (Israel) . On October 25, 2017, a purported consumer class action, captioned Gensin v. HP Inc., was filed in the District Court in Jerusalem against HP arising out of the use of Dynamic Security in certain OfficeJet printers. The petition and motion for certification as a class action alleges: (1) tortious wrongdoing in violation of the Computers Law, 5755-1995; (2) breach of Contracts Law, 5731-1970; (3) breach of the Consumer Protection Law, 5741-1981; (4) negligence; and (5) improper enrichment. The named petitioner initially sought to represent nationwide classes comprised of anyone who “owns an HP printer that has been blocked, disrupted, or interfered with by HP in the use of ink cartridges not manufactured by HP” or who “purchased ink cartridges not manufactured by HP for use in the blocked printers.” Plaintiff seeks class relief, injunctive relief, damages, and attorneys’ fees. On November 16, 2017, a second purported consumer class action was filed against HP in the Central District Court, captioned Dror v. HP, Inc. , also arising out of the use of Dynamic Security in certain OfficeJet printers. The petition and motion allege similar causes of action on behalf of similar nationwide classes. After the Dror case was consolidated with the Gensin case in Jerusalem, the District Court on June 24, 2018 dismissed the Dror case and designated Gensin as the lead matter. On March 9, 2020, the petitioner moved to modify the proposed nationwide class to be comprised of “[a]ll persons who have an HP printer and whose printer was blocked or rendered unusable by HP with any ink cartridge that is not made by HP” and “[a]ll persons who purchased ink cartridges that are not made by HP, for use in the Blocked Printers.” On July 2, 2020, HP filed its response to the amended petition. Parziale v. HP Inc. (United States) . On August 27, 2019, a purported consumer class action was filed against HP in federal court in the Northern District of California arising out of the use of Dynamic Security in certain OfficeJet printers. The complaint alleges two causes of action under Florida Consumer Protection statutes: (1) violation of the Florida Deceptive and Unfair Trade Practices Act, F.S.A. §§ 501.201 et seq., and (2) violation of the Florida Misleading Advertisement Law, F.S.A. §§ 817.41 et seq. The named plaintiff seeks to represent a nationwide class of “[a]ll United States Citizens who, between the applicable statute of limitations and the present, had an HP Printer that was modified to reject third party ink cartridges or refilled HP ink cartridges.” On November 13, 2019, plaintiff filed an amended complaint, adding three causes of action to the case: (1) violation of the Computer Fraud and Abuse Act, 18 U.S.C. § 1030 et seq., (2) trespass to chattels, and (3) tortious interference with business relations. Plaintiff seeks class relief, injunctive relief, damages, including punitive damages, and attorneys’ fees. On December 30, 2019, HP moved to dismiss plaintiff’s amended complaint. On April 24, 2020, the Court granted in part and denied in part HP’s motion to dismiss. The Court dismissed plaintiff’s causes of action under the Florida Consumer Protection statutes, as well as the tortious interference with business relations claim and four of the five claims under the Computer Fraud and Abuse Act. The Court denied HP’s motion to dismiss on the remaining claims and on the request for injunctive relief and granted plaintiff leave to file an amended complaint. On June 5, 2020, plaintiff filed a second amended complaint on behalf of both a nationwide class and a Florida subclass alleging violation of the Florida Deceptive and Unfair Trade Practices Act, violation of the Computer Fraud and Abuse Act, and trespass to chattels. Plaintiff sought class relief, injunctive relief, damages, including punitive damages, and attorneys’ fees. On September 29, 2020, the Court granted HP’s motion to dismiss, dismissing the case in full with prejudice. The plaintiff appealed and the parties subsequently reached a settlement. On August 2, 2021, the plaintiff dismissed the appeal with prejudice. Consumer Protection Investigation (Italy) . On September 26, 2019, the Italian Competition Authority (Autorità Garante della Concorrenza e del Mercato) (“AGCM”) served a Notice of Initiation of Proceedings on HP concerning the investigation of alleged aggressive practices involving undue influence on consumers and alleged misleading actions and omissions regarding the restriction or prevention of the use of third-party ink cartridges in HP printers, accompanied by a request for information. HP submitted its reply to the AGCM’s request for information on November 15, 2019 and has addressed subsequent requests for information. On May 22, 2020, the AGCM gave notice that it intended to expand its investigation into certain alleged warranty practices regarding the use of third-party cartridges. On June 26, 2020, HP submitted its response to the warranty allegations. On December 7, 2020, the AGCM notified HP of the AGCM’s final decision finding that HP engaged in two unfair commercial practices as follows: (a) the information HP provided to consumers about limitations on the use of certain third-party cartridges in HP printers was allegedly misleading pursuant to Articles 20, 21 and 22 of the Italian Consumer Code, and (b) the alleged use of data to deny warranty coverage and certain alleged data collection practices were aggressive pursuant to Articles 20, 24 and 25 of the Italian Consumer Code. The final decision (i) orders HP to end the allegedly unfair commercial practices; (ii) fines HP €5 million for each alleged unfair practice (total €10 million); (iii) requires HP to file a compliance report within 60 days; (iv) orders HP to publicly publish a corrective statement within 120 days; and (v) orders HP to amend the packaging of its printers within 120 days. On December 21, 2020, HP paid the imposed fines. On February 5, 2021, HP filed an appeal. On April 6, 2021, HP filed its compliance report, which it subsequently supplemented, and, on June 23, 2021 the AGCM communicated that it was satisfied with the measures that HP submitted. Digital Revolution B.V. v. HP Nederland B.V., et al. (Netherlands) . On March 30, 2020, Digital Revolution B.V. (a.k.a. 123Inkt) served a complaint filed in Amsterdam District Court arising out of the use of Dynamic Security in certain HP printers. The complaint alleges several causes of action: (1) abuse of dominant position; (2) misleading advertising; (3) unfair and misleading commercial practice; and (4) misleading comparative advertising. The complaint seeks injunctive relief, including prohibition of Dynamic Security and disclosure of cartridge authentication protocols, damages, and attorneys’ fees. The parties’ initial appearance in front of the Court took place on July 8, 2020. On September 9, 2020, HP filed its defense and a counterclaim for unfair commercial practices and misleading and unlawful comparative advertising against Digital Revolution B.V. An oral hearing is scheduled for September 13, 2021. Mobile Emergency Housing Corp., et al. v. HP, Inc. (United States) . On December 17, 2020, a putative consumer class action was filed against HP in federal court in the Northern District of California arising out of the use of Dynamic Security firmware updates. The complaint alleges seven claims under federal and California law: (1) violation of the federal Computer Fraud and Abuse Act (“CFAA”) for allegedly causing “damage without authorization” to the plaintiffs’ printers; (2) violation of the California Comprehensive Computer Data Access and Fraud Act (“CDAFA”); (3) violation of the California False Advertising Law (“FAL”); (4) violation of the “fraudulent” prong of the California Unfair Competition Law (“UCL”); (5) violation of the “unfair” prong of the UCL; (6) violation of the “unlawful” prong of the UCL; and (7) trespass to chattels. Plaintiffs seek to represent a nationwide injunctive-relief class of “all persons in the United States who own a Class Printer” and a monetary relief subclass of those who experienced an error message due to third-party cartridge incompatibility resulting from a firmware update, defining “Class Printers” to include the “HP Color LaserJet Pro M254, HP Color LaserJet Pro MFP M280, HP Color LaserJet Pro MFP M281, and all other models affected” by the firmware updates described in the complaint. On February 10, 2021, HP filed a motion to dismiss the complaint, and in response, on March 2, 2021, plaintiffs amended their complaint. The amended complaint added an additional named plaintiff, a California state consumer subclass, and a California Consumers Legal Remedies Act claim seeking injunctive relief on behalf of the new plaintiff and the state consumer subclass. Plaintiffs subsequently filed Second and Third Amended Complaints |
Guarantees, Indemnifications an
Guarantees, Indemnifications and Warranties | 9 Months Ended |
Jul. 31, 2021 | |
Guarantees [Abstract] | |
Guarantees, Indemnifications and Warranties | Guarantees, Indemnifications and Warranties Guarantees In the ordinary course of business, HP may issue performance guarantees to certain of its clients, customers and other parties pursuant to which HP has guaranteed the performance obligations of third parties. Some of those guarantees may be backed by standby letters of credit or surety bonds. In general, HP would be obligated to perform over the term of the guarantee in the event a specified triggering event occurs as defined by the guarantee. HP believes the likelihood of having to perform under a material guarantee is remote. Cross-Indemnifications with Hewlett Packard Enterprise Under the separation and distribution agreement, HP agreed to indemnify Hewlett Packard Enterprise, each of its subsidiaries and each of their respective directors, officers and employees from and against all liabilities relating to, arising out of or resulting from, among other matters, the liabilities allocated to HP as part of the Separation. Hewlett Packard Enterprise similarly agreed to indemnify HP, each of its subsidiaries and each of their respective directors, officers and employees from and against all liabilities relating to, arising out of or resulting from, among other matters, the liabilities allocated to Hewlett Packard Enterprise as part of the Separation. HP expects Hewlett Packard Enterprise to fully perform under the terms of the separation and distribution agreement. For information on cross-indemnifications with Hewlett Packard Enterprise for litigation matters, see Note 12, “Litigation and Contingencies.” Indemnifications In the ordinary course of business, HP enters into contractual arrangements under which HP may agree to indemnify a third-party to such arrangement from any losses incurred relating to the services they perform on behalf of HP or for losses arising from certain events as defined within the particular contract, which may include, for example, litigation or claims relating to past performance. HP also provides indemnifications to certain vendors and customers against claims of intellectual property infringement made by third parties arising from the vendors’ and customers’ use of HP’s software products and services and certain other matters. Some indemnifications may not be subject to maximum loss clauses. Historically, payments made related to these indemnifications have been immaterial. HP records tax indemnification receivables from various third parties for certain tax liabilities that HP is jointly and severally liable for, but for which it is indemnified by those same third parties under existing legal agreements. HP records a tax indemnification payable to various third parties under these agreements when management believes that it is both probable that a liability has been incurred and the amount can be reasonably estimated. The actual amount that the third parties pay or may be obligated to pay HP could vary depending on the outcome of certain unresolved tax matters, which may not be resolved for several years. Warranties HP accrues the estimated cost of product warranties at the time it recognizes revenue. HP engages in extensive product quality programs and processes, including actively monitoring and evaluating the quality of its component suppliers; however, contractual warranty terms, repair costs, product call rates, average cost per call, current period product shipments and ongoing product failure rates, as well as specific product class failures outside of HP’s baseline experience, affect the estimated warranty obligation. HP’s aggregate product warranty liabilities and changes were as follows: Nine months ended July 31, 2021 In millions Balance at beginning of period $ 993 Accruals for warranties issued 753 Adjustments related to pre-existing warranties (including changes in estimates) 16 Settlements made (in cash or in kind) (777) Balance at end of period $ 985 |
Commitments
Commitments | 9 Months Ended |
Jul. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments | Commitments Unconditional Purchase Obligations As of July 31, 2021, HP had unconditional purchase obligations of $6.8 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. These unconditional purchase obligations are primarily related to inventory and service support. Unconditional purchase obligations exclude agreements that are cancellable without penalty. As of July 31, 2021, unconditional purchase obligations were as follows: Fiscal year In millions 2021 (1) $ 692 2022 2,328 2023 2,276 2024 1,431 2025 70 Thereafter 18 Total $ 6,815 (1) Represents expected unconditional purchase obligations for the remaining three months of the fiscal year 2021. |
Acquisitions
Acquisitions | 9 Months Ended |
Jul. 31, 2021 | |
Business Combination and Asset Acquisition [Abstract] | |
Acquisitions | Acquisitions On June 1, 2021, HP completed the acquisition of HyperX, the gaming division of Kingston Technology Company. The acquisition supports HP’s strategy to drive growth in gaming and peripherals within the Personal Systems segment. The table below presents the preliminary purchase price allocation for HP's acquisition as of June 1, 2021 and reflects various preliminary fair value estimates and analyses, including preliminary work performed by third-party valuation specialists, which are subject to change within the measurement period as valuations are finalized. The primary areas of the preliminary purchase price allocation that are not yet finalized relate to the fair values of certain tangible assets and liabilities acquired, the valuation of intangible assets acquired and residual goodwill. HP expects to continue to obtain information to assist it in determining the fair value of the net assets acquired at the acquisition date during the measurement period. In millions Goodwill $ 101 Amortizable intangible assets 208 Net assets assumed 103 Total fair value of consideration $ 412 |
Intangibles
Intangibles | 9 Months Ended |
Jul. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangibles | Intangibles HP’s acquired intangible assets were composed of: As of July 31, 2021 As of October 31, 2020 Gross Accumulated Amortization Net Gross Accumulated Amortization Net In millions Customer contracts, customer lists and distribution agreements $ 479 $ 189 $ 290 $ 382 $ 149 $ 233 Technology and patents 764 399 365 621 332 289 Trade name and trademarks 98 12 86 26 8 18 Total intangible assets $ 1,341 $ 600 $ 741 $ 1,029 $ 489 $ 540 During the nine months ended July 31, 2021, the increase in gross intangible assets was primarily due to intangible assets resulting from acquisitions. The reported amounts are based on preliminary fair value estimates of the assets acquired. The weighted-average useful lives of intangible assets acquired during the period are as follows: Weighted-Average Useful Life (in years) Customer contracts and customer lists 2 Technology and patents 7 Trade name and trademarks 15 As of July 31, 2021, estimated future amortization expense related to intangible assets was as follows: Fiscal year In millions 2021 (1) $ 49 2022 184 2023 139 2024 105 2025 62 Thereafter 202 Total $ 741 (1) Represents expected amortization for the remaining three months of the fiscal year 2021. |
Basis of Presentation (Policies
Basis of Presentation (Policies) | 9 Months Ended |
Jul. 31, 2021 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying Consolidated Condensed Financial Statements of HP and its wholly-owned subsidiaries are prepared in conformity with United States (“U.S.”) generally accepted accounting principles (“GAAP”). 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, 2020 in the Annual Report on Form 10-K, filed on December 10, 2020. The Consolidated Condensed Balance Sheet for October 31, 2020 was derived from audited financial statements. |
Principles of Consolidation | Principles of Consolidation The Consolidated Condensed Financial Statements include the accounts of HP and its subsidiaries and affiliates in which HP has a controlling financial interest or is the primary beneficiary. All intercompany balances and transactions have been eliminated. |
Use of Estimates | Use of Estimates The preparation of financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in HP’s Consolidated Condensed Financial Statements and accompanying notes. Actual results may differ materially from those estimates. As of July 31, 2021, 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 a result, many of our estimates and assumptions required increased judgment and may carry a higher degree of variability and volatility. As the events continue to evolve with respect to the pandemic, our estimates may materially change in future periods. |
Recently Adopted Accounting Pronouncements | Recently Adopted Accounting PronouncementsIn June 2016, the FASB issued guidance, which requires credit losses on financial assets measured at amortized cost basis to be presented at the net amount expected to be collected, not based on incurred losses. Furthermore, credit losses on available-for-sale debt securities should be recorded through an allowance for credit losses limited to the amount by which fair value is below amortized cost. HP adopted the new credit loss standard as of November 1, 2020 using a modified retrospective approach. The cumulative effect upon adoption was not material to the consolidated condensed financial statements. |
Accounts Receivable | Accounts receivable HP records allowance for credit losses for the current expected credit losses inherent in the asset over its expected life. The allowance for credit losses is maintained based on the relevant information about past events, including historical experience, current conditions, and reasonable and supportable forecasts that affect the collectability of the reported amount. HP records a specific reserve for individual accounts when HP becomes aware of specific customer circumstances, such as in the case of a bankruptcy filing or deterioration in the customer’s operating results or financial position. If there are additional changes in circumstances related to the specific customer, HP further adjusts estimates of the recoverability of receivables. HP assesses collectability by pooling receivables where similar risk characteristics exist. HP maintains an allowance for credit losses for all other customers based on a variety of factors, including the use of third-party credit risk models that generate quantitative measures of default probabilities based on market factors, financial condition of customers, length of time receivables are past due, trends in the weighted-average risk rating for the portfolio, macroeconomic conditions, information derived from competitive benchmarking, significant one-time events, and historical experience. The past due or delinquency status of a receivable is based on the contractual payment terms of the receivable. HP has third-party short-term financing arrangements intended to facilitate the working capital requirements of certain customers. These financing arrangements, which in certain cases provide for partial recourse, result in the transfer of HP’s trade receivables to a third-party. HP reflects amounts transferred to, but not yet collected from the third-party in Accounts receivable in the Consolidated Condensed Balance Sheets. For arrangements involving an element of recourse, the fair value of the |
Debt and Marketable Equity Securities Investments | Debt and Marketable Equity Securities Investments HP determines the appropriate classification of its investments at the time of purchase and re-evaluates the classifications at each balance sheet date. Debt and marketable equity securities are generally considered available-for-sale. All highly liquid investments with maturities of three months or less at the date of purchase are classified as cash equivalents. Marketable debt securities with maturities of twelve months or less are classified as short-term investments and marketable debt securities with maturities greater than twelve months are classified based on their availability for use in current operations. Marketable equity securities, including mutual funds, are classified as either short or long-term based on the nature of each security and its availability for use in current operations. Available-for-sale debt securities are reported at fair value with unrealized gains and losses, net of applicable taxes, in Accumulated other comprehensive loss. Unrealized gains and losses on equity securities, credit losses and impairments on available-for-sale debt securities are recorded in Consolidated Condensed Statements of Earnings. Realized gains and losses on available-for-sale securities are calculated at the individual security level and included in Interest and other, net in the Consolidated Condensed Statements of Earnings. HP monitors its investment portfolio for potential impairment and credit losses on a quarterly basis. If HP intends to sell a debt security or it is more likely than not that HP will be required to sell the security before recovery, then a decline in fair value below cost is recorded as an impairment charge in Interest and other, net and a new cost basis in the investment is established. In other cases, if the carrying amount of an investment in debt securities exceeds its fair value and the decline in value is determined to be due to credit related reasons, HP records a credit loss allowance, limited by the amount that fair value is less than the amortized cost basis. HP recognizes the corresponding charge in Interest and other, net and the remaining unrealized loss, if any, in Accumulated other comprehensive loss in the Consolidated Condensed Balance Sheets. Factors that HP considers while determining the credit loss allowance includes, but is not limited to, severity and the reason for the decline in value, interest rate changes and counterparty long-term ratings. |
Segment Information | The accounting policies HP uses to derive segment results are substantially the same as those used by HP in preparing these financial statements. HP derives the results of the business segments directly from its internal management reporting system.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. |
Employer Contributions and Funding Policy | Employer Contributions and Funding Policy HP’s policy is to fund its pension plans so that it makes at least the minimum contribution required by local government, funding and taxing authorities. |
Taxes on Earnings | 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. |
Transfers and Servicing Trade Receivables Policy | HP has 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. As these transfers qualify as true sales under the applicable accounting guidance, the receivables are de-recognized from the Consolidated Condensed Balance Sheets upon transfer, and HP receives a payment for the receivables from the third-party within a mutually agreed upon time period. 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 July 31, 2021 and October 31, 2020 were not material. The costs associated with the sale of trade receivables for the three and nine months ended July 31, 2021 and 2020 were not material. |
Fair Value | Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the measurement date. Fair Value Hierarchy HP uses valuation techniques that are based upon observable and unobservable inputs. Observable inputs are developed using market data such as publicly available information and reflect the assumptions market participants would use, while unobservable inputs are developed using the best information available about the assumptions market participants would use. Assets and liabilities are classified in the fair value hierarchy based on the lowest level input that is significant to the fair value measurement: Level 1—Quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2—Quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability and market-corroborated inputs. Level 3—Unobservable inputs for the asset or liability. The fair value hierarchy gives the highest priority to observable inputs and lowest priority to unobservable inputs. Valuation Techniques Cash Equivalents and Investments: HP holds time deposits, money market funds, mutual funds, other debt securities primarily consisting of corporate and foreign government notes and bonds, and common stock and equivalents. HP values cash equivalents and equity investments using quoted market prices, alternative pricing sources, including net asset value, or models utilizing market observable inputs. The fair value of debt investments is based on quoted market prices or model-driven valuations using inputs primarily derived from or corroborated by observable market data, and, in certain instances, valuation models that utilize assumptions which cannot be corroborated with observable market data. Derivative Instruments: HP uses industry standard valuation models to measure fair value. Where applicable, these models project future cash flows and discount the future amounts to present value using market-based observable inputs, including interest rate curves, HP and counterparty credit risk, foreign exchange rates, and forward and spot prices for currencies and interest rates. See Note 8, “Financial Instruments” for a further discussion of HP’s use of derivative instruments. Other Fair Value Disclosures Short- and Long-Term Debt: HP estimates the fair value of its debt primarily using an expected present value technique, which is based on observable market inputs using interest rates currently available to companies of similar credit standing for similar terms and remaining maturities and considering its own credit risk. 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 $7.7 billion as of July 31, 2021, compared to its carrying amount of $7.1 billion at that date. The fair value of HP’s short- and long-term debt was $6.7 billion as of October 31, 2020, compared to its carrying value of $6.2 billion at that date. If measured at fair value in the Consolidated Condensed Balance Sheets, short- and long-term debt would be classified in Level 2 of the fair value hierarchy. Other Financial Instruments: For the balance of HP’s financial instruments, primarily accounts receivable, accounts payable and financial liabilities included in Other current liabilities on the Consolidated Condensed Balance Sheets, the carrying amounts approximate fair value due to their short maturities. If measured at fair value in the Consolidated Condensed Balance Sheets, these other financial instruments would be classified as Level 2 or Level 3 in the fair value hierarchy. Non-Marketable Equity Investments and Non-Financial Assets: HP’s non-marketable equity investments are measured at cost less impairment, adjusted for observable price changes. HP’s non-financial assets, such as intangible assets, goodwill and property, plant and equipment, are recorded at fair value in the period an impairment charge is recognized. If measured at fair value in the Consolidated Condensed Balance Sheets these would generally be classified within Level 3 of the fair value hierarchy. |
Cash Equivalents and Available-for-Sale Investments | All highly liquid investments with original maturities of three months or less at the date of acquisition are considered cash equivalents. |
Derivative Instruments | Derivative Instruments HP uses derivatives to offset business exposure to foreign currency and interest rate risk on expected future cash flows and on certain existing assets and liabilities. As part of its risk management strategy, HP uses derivative instruments, primarily forward contracts, interest rate swaps, total return swaps, treasury rate locks, forward starting swaps and, at times, option contracts to hedge certain foreign currency, interest rate and, return on certain investment exposures. HP may designate its derivative contracts as fair value hedges or cash flow hedges and classifies the cash flows with the activities that correspond to the underlying hedged items. Additionally, for derivatives not designated as hedging instruments, HP categorizes those economic hedges as other derivatives. 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 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 $95 million and $90 million as of July 31, 2021 and as of October 31, 2020, respectively, all of which were fully collateralized within two 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 July 31, 2021 and October 31, 2020. Fair Value Hedges HP enters into fair value hedges, such as interest rate swaps, to reduce the exposure of its debt portfolio to changes in fair value resulting from changes in benchmark interest rates on HP’s future interest rate payments. For derivative instruments that are designated and qualify as fair value hedges, HP recognizes the change 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. During the nine months ended July 31, 2021, HP entered into interest rate swaps with a notional amount of $375 million that were designated as fair value hedges, to convert a portion of its fixed-rate debt to floating. HP terminated interest rate swaps with a notional amount of $500 million that were de-designated as fair value hedges including $250 million notional amount related to certain fixed-rate debt securities that were extinguished, resulting in an immaterial loss. Cash Flow Hedges HP uses forward contracts, treasury rate locks, forward starting swaps and, at times, option contracts designated as cash flow hedges to protect against the foreign currency exchange and interest rate risks inherent in its forecasted net revenue, cost of revenue, operating expenses and debt issuance. HP’s foreign currency cash flow hedges mature predominantly within twelve months; however, hedges related to long-term procurement arrangements extend several years. For derivative instruments that are designated and qualify as cash flow hedges, HP initially records changes in fair value of the derivative instrument in Accumulated other comprehensive loss as a separate component of stockholders’ deficit in the Consolidated Condensed Balance Sheets and subsequently reclassifies these amounts into earnings in the period during which the hedged transaction is recognized in earnings. 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. During the nine months ended July 31, 2021, HP entered into a series of forward starting swap agreements with notional amounts totaling $1.75 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. These agreements were designated as cash flow hedges. In June 2021, a series of these forward starting swaps totaling $750 million notional amount were settled upon the issuance of the senior notes resulting in an immaterial loss recognized in Accumulated other comprehensive loss. The loss will be reclassified to Interest and other, net over the life of the related debt. Other Derivatives Other derivatives not designated as hedging instruments consist primarily of forward contracts used to hedge foreign currency-denominated balance sheet exposures. HP also uses total return swaps to hedge its executive deferred compensation plan liability. 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. |
Offsetting of Derivatives Instruments | Offsetting of Derivative InstrumentsHP recognizes all derivative instruments on a gross basis in the Consolidated Condensed Balance Sheets. HP does not offset the fair value of its derivative instruments against the fair value of cash collateral posted under its collateral security agreements. |
Net Earnings Per Share | HP calculates basic net EPS using net earnings and the weighted-average number of shares outstanding during the reporting period. Diluted net EPS includes any dilutive effect of restricted stock units, stock options, performance-based awards and shares purchased under the 2021 employee stock purchase plan. |
Litigation and Contingencies | HP is involved in lawsuits, claims, investigations and proceedings, including those identified below, consisting of IP, commercial, securities, employment, employee benefits and environmental matters that arise in the ordinary course of business. 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 July 31, 2021, 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. Pursuant to the separation and distribution agreement, HP shares responsibility with Hewlett Packard Enterprise for certain matters, as indicated below, and Hewlett Packard Enterprise has agreed to indemnify HP in whole or in part with respect to certain matters. Based on its experience, HP believes that any damage amounts claimed in the specific matters discussed below are not a meaningful indicator of HP’s potential liability. Litigation is inherently unpredictable. However, HP believes it has valid defenses with respect to legal matters pending against it. Nevertheless, cash flows or results of operations could be materially affected in any particular period by the resolution of one or more of these contingencies. |
Guarantees, Indemnifications and Warranties | Guarantees In the ordinary course of business, HP may issue performance guarantees to certain of its clients, customers and other parties pursuant to which HP has guaranteed the performance obligations of third parties. Some of those guarantees may be backed by standby letters of credit or surety bonds. In general, HP would be obligated to perform over the term of the guarantee in the event a specified triggering event occurs as defined by the guarantee. HP believes the likelihood of having to perform under a material guarantee is remote. Cross-Indemnifications with Hewlett Packard Enterprise Under the separation and distribution agreement, HP agreed to indemnify Hewlett Packard Enterprise, each of its subsidiaries and each of their respective directors, officers and employees from and against all liabilities relating to, arising out of or resulting from, among other matters, the liabilities allocated to HP as part of the Separation. Hewlett Packard Enterprise similarly agreed to indemnify HP, each of its subsidiaries and each of their respective directors, officers and employees from and against all liabilities relating to, arising out of or resulting from, among other matters, the liabilities allocated to Hewlett Packard Enterprise as part of the Separation. HP expects Hewlett Packard Enterprise to fully perform under the terms of the separation and distribution agreement. For information on cross-indemnifications with Hewlett Packard Enterprise for litigation matters, see Note 12, “Litigation and Contingencies.” Indemnifications In the ordinary course of business, HP enters into contractual arrangements under which HP may agree to indemnify a third-party to such arrangement from any losses incurred relating to the services they perform on behalf of HP or for losses arising from certain events as defined within the particular contract, which may include, for example, litigation or claims relating to past performance. HP also provides indemnifications to certain vendors and customers against claims of intellectual property infringement made by third parties arising from the vendors’ and customers’ use of HP’s software products and services and certain other matters. Some indemnifications may not be subject to maximum loss clauses. Historically, payments made related to these indemnifications have been immaterial. HP records tax indemnification receivables from various third parties for certain tax liabilities that HP is jointly and severally liable for, but for which it is indemnified by those same third parties under existing legal agreements. HP records a tax indemnification payable to various third parties under these agreements when management believes that it is both probable that a liability has been incurred and the amount can be reasonably estimated. The actual amount that the third parties pay or may be obligated to pay HP could vary depending on the outcome of certain unresolved tax matters, which may not be resolved for several years. Warranties HP accrues the estimated cost of product warranties at the time it recognizes revenue. HP engages in extensive product quality programs and processes, including actively monitoring and evaluating the quality of its component suppliers; however, contractual warranty terms, repair costs, product call rates, average cost per call, current period product shipments and ongoing product failure rates, as well as specific product class failures outside of HP’s baseline experience, affect the estimated warranty obligation. |
Segment Information (Tables)
Segment Information (Tables) | 9 Months Ended |
Jul. 31, 2021 | |
Segment Reporting [Abstract] | |
Reconciliation of Segment Operating Results to Consolidated Results | Segment Operating Results from Operations and the reconciliation to HP consolidated results were as follows: Three months ended July 31 Nine months ended July 31 2021 2020 2021 2020 In millions Net revenue: Notebooks $ 7,328 $ 7,304 $ 22,183 $ 18,361 Desktops 2,246 2,221 6,871 7,553 Workstations 388 428 1,177 1,461 Other 444 407 1,333 1,190 Personal Systems 10,406 10,360 31,564 28,565 Supplies 3,092 2,573 9,575 8,455 Commercial 1,070 732 3,112 2,616 Consumer 720 628 2,562 1,744 Printing 4,882 3,933 15,249 12,815 Corporate Investments — 1 1 2 Total segment net revenue 15,288 14,294 46,814 41,382 Other 1 — (2) (1) Total net revenue $ 15,289 $ 14,294 $ 46,812 $ 41,381 Earnings before taxes: Personal Systems $ 869 $ 570 $ 2,337 $ 1,784 Printing 857 480 2,806 1,782 Corporate Investments (20) (15) (82) (42) Total segment earnings from operations 1,706 1,035 5,061 3,524 Corporate and unallocated costs and other (134) (108) (378) (304) Stock-based compensation expense (69) (49) (260) (221) Restructuring and other charges (56) (59) (216) (431) Acquisition-related charges (24) (11) (40) (14) Amortization of intangible assets (42) (29) (103) (84) Interest and other, net (55) (28) (106) (15) Total earnings before taxes $ 1,326 $ 751 $ 3,958 $ 2,455 |
Schedule of Reconciliation of Segment Operating Results to HP Consolidated Results | Segment Operating Results from Operations and the reconciliation to HP consolidated results were as follows: Three months ended July 31 Nine months ended July 31 2021 2020 2021 2020 In millions Net revenue: Notebooks $ 7,328 $ 7,304 $ 22,183 $ 18,361 Desktops 2,246 2,221 6,871 7,553 Workstations 388 428 1,177 1,461 Other 444 407 1,333 1,190 Personal Systems 10,406 10,360 31,564 28,565 Supplies 3,092 2,573 9,575 8,455 Commercial 1,070 732 3,112 2,616 Consumer 720 628 2,562 1,744 Printing 4,882 3,933 15,249 12,815 Corporate Investments — 1 1 2 Total segment net revenue 15,288 14,294 46,814 41,382 Other 1 — (2) (1) Total net revenue $ 15,289 $ 14,294 $ 46,812 $ 41,381 Earnings before taxes: Personal Systems $ 869 $ 570 $ 2,337 $ 1,784 Printing 857 480 2,806 1,782 Corporate Investments (20) (15) (82) (42) Total segment earnings from operations 1,706 1,035 5,061 3,524 Corporate and unallocated costs and other (134) (108) (378) (304) Stock-based compensation expense (69) (49) (260) (221) Restructuring and other charges (56) (59) (216) (431) Acquisition-related charges (24) (11) (40) (14) Amortization of intangible assets (42) (29) (103) (84) Interest and other, net (55) (28) (106) (15) Total earnings before taxes $ 1,326 $ 751 $ 3,958 $ 2,455 |
Restructuring and Other Charg_2
Restructuring and Other Charges (Tables) | 9 Months Ended |
Jul. 31, 2021 | |
Restructuring and Related Activities [Abstract] | |
Summary of Restructuring Plans | HP’s restructuring activities for the nine months ended July 31, 2021 and 2020 summarized by plan were as follows: Fiscal 2020 Plan Severance and EER Non-labor Other prior-year Plans Total In millions Accrued balance as of October 31, 2020 $ 55 $ — $ 12 $ 67 Charges 164 35 — 199 Cash payments (132) (4) (12) (148) Non-cash and other adjustments (1) (31) — (32) Accrued balance as of July 31, 2021 $ 86 $ — $ — $ 86 Total costs incurred to date as of July 31, 2021 $ 592 $ 45 $ 1,817 $ 2,454 Reflected in Consolidated Condensed Balance Sheets Other current liabilities $ 86 $ — $ — $ 86 Accrued balance as of October 31, 2019 $ 76 $ — $ 66 $ 142 Charges 325 5 1 331 Cash payments (256) (5) (48) (309) Non-cash and other adjustments (48) (1) — (3) (51) Accrued balance as of July 31, 2020 $ 97 $ — $ 16 $ 113 (1) Includes reclassification of liability related to the Enhanced Early Retirement (“EER”) plan of $44 million for certain healthcare and medical savings account benefits to pension and post-retirement plans. HP’s restructuring charges for the three months ended July 31, 2021 summarized by the plans outlined below were as follows: Fiscal 2020 Plan Severance and EER Non-labor Total In millions For the three months ended July 31, 2021 $ 28 $ 20 $ 48 |
Retirement and Post-Retiremen_2
Retirement and Post-Retirement Benefit Plans (Tables) | 9 Months Ended |
Jul. 31, 2021 | |
Retirement Benefits [Abstract] | |
Schedule of Pension and Post-Retirement Benefit (Credit) Cost | 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 July 31 U.S. Defined Benefit Plans Non-U.S. Defined Benefit Plans Post-Retirement Benefit Plans 2021 2020 2021 2020 2021 2020 In millions Service cost $ — $ — $ 16 $ 16 $ — $ — Interest cost 76 103 5 4 2 3 Expected return on plan assets (127) (175) (13) (10) (5) (6) Amortization and deferrals: Actuarial loss (gain) 14 16 13 11 (4) (3) Prior service benefit — — (1) (1) (2) (3) Net periodic benefit (credit) cost (37) (56) 20 20 (9) (9) Settlement loss — 2 — — — — Total periodic benefit (credit) cost $ (37) $ (54) $ 20 $ 20 $ (9) $ (9) Nine months ended July 31 U.S. Defined Benefit Plans Non-U.S. Defined Benefit Plans Post- Retirement Benefit Plans 2021 2020 2021 2020 2021 2020 In millions Service cost $ — $ — $ 50 $ 47 $ 1 $ 1 Interest cost 228 309 14 13 6 8 Expected return on plan assets (381) (525) (37) (31) (17) (17) Amortization and deferrals: Actuarial loss (gain) 44 48 40 32 (12) (8) Prior service benefit — — (2) (2) (8) (9) Net periodic benefit (credit) cost (109) (168) 65 59 (30) (25) Settlement loss 1 3 — — — — Special termination benefit cost — — — — — 44 Total periodic benefit (credit) cost $ (108) $ (165) $ 65 $ 59 $ (30) $ 19 |
Supplementary Financial Infor_2
Supplementary Financial Information (Tables) | 9 Months Ended |
Jul. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Allowance for Doubtful Accounts Related to Accounts Receivable | The allowance for credit losses related to accounts receivable and changes were as follows: Nine months ended July 31, 2021 In millions Balance at beginning of period $ 122 Current-period allowance for credit losses 9 Deductions, net of recoveries (14) Balance at end of period $ 117 |
Schedule of Transferred Trade Receivables Not Collected from Third Parties | The following is a summary of the activity under these arrangements: Three months ended July 31 Nine months ended July 31 2021 2020 2021 2020 In millions Balance at beginning of period (1) $ 212 $ 124 $ 188 $ 235 Trade receivables sold 2,667 2,231 9,155 7,411 Cash receipts (2,711) (2,254) (9,181) (7,544) Foreign currency and other (2) 8 4 7 Balance at end of period (1) $ 166 $ 109 $ 166 $ 109 (1) Amounts outstanding from third parties reported in Accounts receivable in the Consolidated Condensed Balance Sheets. |
Inventory | Inventory As of July 31, 2021 October 31, 2020 In millions Finished goods $ 4,187 $ 3,662 Purchased parts and fabricated assemblies (1) 3,978 2,301 $ 8,165 $ 5,963 (1) Increase is attributable to strategic buys in Personal Systems. |
Other Current Assets | Other Current Assets As of July 31, 2021 October 31, 2020 In millions Supplier and other receivables $ 2,218 $ 2,092 Prepaid and other current assets 1,031 1,104 Value-added taxes receivable 834 970 Available-for-sale investments 8 274 $ 4,091 $ 4,440 |
Property, Plant and Equipment, net | Property, Plant and Equipment, net As of July 31, 2021 October 31, 2020 In millions Land, buildings and leasehold improvements $ 2,168 $ 2,066 Machinery and equipment, including equipment held for lease 5,259 5,275 7,427 7,341 Accumulated depreciation (4,927) (4,714) $ 2,500 $ 2,627 |
Other Non-Current Assets | Other Non-Current Assets As of July 31, 2021 October 31, 2020 In millions Deferred tax assets $ 2,581 $ 2,515 Right-of-use assets from operating leases, net 1,114 1,107 Deposits and prepaid 757 337 Intangible assets 741 540 Other 599 527 $ 5,792 $ 5,026 |
Other Current Liabilities | Other Current Liabilities As of July 31, 2021 October 31, 2020 In millions Sales and marketing programs $ 3,101 $ 3,185 Employee compensation and benefit 1,462 1,194 Deferred revenue 1,335 1,208 Other accrued taxes 1,020 1,051 Warranty 752 746 Operating lease liabilities 330 275 Tax liability 271 223 Other 3,284 2,960 $ 11,555 $ 10,842 |
Other Non-Current Liabilities | Other Non-Current Liabilities As of July 31, 2021 October 31, 2020 In millions Pension, post-retirement, and post-employment liabilities $ 1,342 $ 1,576 Deferred revenue 1,043 1,072 Operating lease liabilities 878 904 Tax liability 751 746 Deferred tax liability 47 25 Other 839 823 $ 4,900 $ 5,146 |
Interest and Other, Net | Interest and other, net Three months ended July 31 Nine months ended July 31 2021 2020 2021 2020 In millions Interest expense on borrowings $ (68) $ (55) $ (193) $ (176) Loss on extinguishment of debt (1) (16) (40) (16) (40) Other, net 29 67 103 201 $ (55) $ (28) $ (106) $ (15) (1) See Note 9 “Borrowings” for detailed information. |
Net Revenue by Region | Net revenue by region Three months ended July 31 Nine months ended July 31 2021 2020 2021 2020 In millions Americas $ 7,006 $ 6,229 $ 20,746 $ 17,393 Europe, Middle East and Africa 5,004 4,725 16,267 14,611 Asia-Pacific and Japan 3,279 3,340 9,799 9,377 Total net revenue $ 15,289 $ 14,294 $ 46,812 $ 41,381 |
Fair Value (Tables)
Fair Value (Tables) | 9 Months Ended |
Jul. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Assets and Liabilities Measured and Recorded at Fair Value on a Recurring Basis | The following table presents HP’s assets and liabilities that are measured at fair value on a recurring basis: As of July 31, 2021 As of October 31, 2020 Fair Value Measured Using Fair Value Measured Using Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total In millions Assets: Cash Equivalents: Corporate debt $ — $ 1,407 $ — $ 1,407 $ — $ 1,700 $ — $ 1,700 Financial institution instruments — — — — — 59 — 59 Government debt (1) 770 — — 770 1,992 181 — 2,173 Available-for-Sale Investments: Corporate debt — — — — — 169 — 169 Financial institution instruments — 8 — 8 — 32 — 32 Government debt (1) — — — — — 73 — 73 Mutual funds 6 57 — 63 5 53 — 58 Derivative Instruments: Interest rate contracts — 2 — 2 — 4 — 4 Foreign currency contracts — 188 — 188 — 191 — 191 Other derivatives — 1 — 1 — — — — Total assets $ 776 $ 1,663 $ — $ 2,439 $ 1,997 $ 2,462 $ — $ 4,459 Liabilities: Derivative Instruments: Interest rate contracts $ — $ 6 $ — $ 6 $ — $ 3 $ — $ 3 Foreign currency contracts — 224 — 224 — 256 — 256 Other derivatives — 1 — 1 — 3 — 3 Total liabilities $ — $ 231 $ — $ 231 $ — $ 262 $ — $ 262 (1) Government debt includes instruments such as U.S. treasury notes, U.S. agency securities and non-U.S. government bonds. Money market funds invested in government debt and traded in active markets are included in Level 1. |
Financial Instruments (Tables)
Financial Instruments (Tables) | 9 Months Ended |
Jul. 31, 2021 | |
Investments, All Other Investments [Abstract] | |
Schedule of Cash Equivalents and Available-for-Sale Investments | Cash Equivalents and Available-for-Sale Investments As of July 31, 2021 As of October 31, 2020 Cost Gross Unrealized Gain Gross Unrealized Loss Fair Value Cost Gross Unrealized Gain Gross Unrealized Loss Fair Value In millions Cash Equivalents: Corporate debt $ 1,407 $ — $ — $ 1,407 $ 1,700 $ — $ — $ 1,700 Financial institution instruments — — — — 59 — — 59 Government debt 770 — — 770 2,173 — — 2,173 Total cash equivalents 2,177 — — 2,177 3,932 — — 3,932 Available-for-Sale Investments: Corporate debt (1) — — — — 169 — — 169 Financial institution instruments (1) 8 — — 8 32 — — 32 Government debt (1) — — — — 73 — — 73 Mutual funds 44 19 — 63 42 16 — 58 Total available-for-sale investments 52 19 — 71 316 16 — 332 Total cash equivalents and available-for-sale investments $ 2,229 $ 19 $ — $ 2,248 $ 4,248 $ 16 $ — $ 4,264 (1) HP classifies its marketable debt securities as Available-for-sale investments within Other current assets on the Consolidated Condensed Balance Sheets, including those with maturity dates beyond one year, based on their highly liquid nature and availability for use in current operations. |
Schedule of Contractual Maturities | Contractual maturities of investments in available-for-sale debt securities were as follows: As of July 31, 2021 Amortized Fair Value In millions Due in one year $ 8 $ 8 |
Schedule of Gross Notional and Fair Value of Derivative Financial Instruments in the Consolidated Condensed Balance Sheets | Gross notional and fair value of derivative instruments in the Consolidated Condensed Balance Sheets were as follows: As of July 31, 2021 As of October 31, 2020 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 In millions Derivatives designated as hedging instruments Fair value hedges: Interest rate contracts $ 750 $ — $ 2 $ — $ 6 $ 875 $ 4 $ — $ — $ 3 Cash flow hedges: Foreign currency contracts 16,531 142 32 135 47 15,661 148 30 199 37 Interest rate contracts 1,000 — — — 27 — — — — — Total derivatives designated as hedging instruments 18,281 142 34 135 80 16,536 152 30 199 40 Derivatives not designated as hedging instruments Foreign currency contracts 5,519 14 — 15 — 5,319 13 — 20 — Other derivatives 155 1 — 1 — 142 — — 3 — Total derivatives not designated as hedging instruments 5,674 15 — 16 — 5,461 13 — 23 — Total derivatives $ 23,955 $ 157 $ 34 $ 151 $ 80 $ 21,997 $ 165 $ 30 $ 222 $ 40 |
Schedule of Offsetting Assets | As of July 31, 2021 and October 31, 2020, information related to the potential effect of HP’s master netting agreements and collateral security agreements was as follows: In the Consolidated Condensed Balance Sheets Gross Amounts Not Offset Gross Amount Gross Amount Net Amount Derivatives Financial Net Amount In millions As of July 31, 2021 Derivative assets $ 191 $ — $ 191 $ 133 $ 34 (1) $ 24 Derivative liabilities $ 231 $ — $ 231 $ 133 $ 75 (2) $ 23 As of October 31, 2020 Derivative assets $ 195 $ — $ 195 $ 156 $ 4 (1) $ 35 Derivative liabilities $ 262 $ — $ 262 $ 156 $ 130 (2) $ (24) (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 (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 |
Schedule of Offsetting Liabilities | As of July 31, 2021 and October 31, 2020, information related to the potential effect of HP’s master netting agreements and collateral security agreements was as follows: In the Consolidated Condensed Balance Sheets Gross Amounts Not Offset Gross Amount Gross Amount Net Amount Derivatives Financial Net Amount In millions As of July 31, 2021 Derivative assets $ 191 $ — $ 191 $ 133 $ 34 (1) $ 24 Derivative liabilities $ 231 $ — $ 231 $ 133 $ 75 (2) $ 23 As of October 31, 2020 Derivative assets $ 195 $ — $ 195 $ 156 $ 4 (1) $ 35 Derivative liabilities $ 262 $ — $ 262 $ 156 $ 130 (2) $ (24) (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 (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 |
Schedule of Pre-Tax Effect of Derivative Instruments and Related Hedged Items in a Fair Value Hedging Relationship | The pre-tax effect of derivative instruments and related hedged items in a fair value hedging relationship were as follows: 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 In millions Three months ended July 31 Interest rate contract Fixed-rate debt Interest and other, net 2021 $ (55) $ 5 $ (5) 2020 $ (28) $ 1 $ (1) Nine months ended July 31 Interest rate contract Fixed-rate debt Interest and other, net 2021 $ (106) $ (5) $ 5 2020 $ (15) $ 11 $ (11) |
Schedule of Pre-Tax Effect of Derivative Instruments in Cash Flow Hedging Relationships | The pre-tax effect of derivative instruments in cash flow hedging relationships included in Accumulated other comprehensive loss was as follows: Three months ended July 31 Nine months ended July 31 2021 2020 2021 2020 In millions Gain/(loss) recognized in Accumulated other comprehensive loss on derivatives: Foreign currency contracts $ 167 $ (567) $ (220) $ (268) Interest rate contracts $ (34) $ 4 $ (34) $ (4) The pre-tax effect of derivative instruments in cash flow hedging relationships included in earnings were as follows: Total amounts of income/(expense) line items in the statement of financial performance in which the effects of cash flow hedges are recorded Gain/(loss) reclassified from Accumulated Three months ended July 31 Nine months ended July 31 Three months ended July 31 Nine months ended July 31 2021 2020 2021 2020 2021 2020 2021 2020 In millions Net revenue $ 15,289 $ 14,294 $ 46,812 $ 41,381 $ (57) $ 136 $ (246) $ 259 Cost of revenue (11,901) (11,901) (36,660) (33,623) (7) (7) (17) (18) Other operating expenses (2,007) (1,614) (6,088) (5,288) — 1 1 1 Interest and other, net (55) (28) (106) (15) — — — — Total $ 1,326 $ 751 $ 3,958 $ 2,455 $ (64) $ 130 $ (262) $ 242 |
Schedule of Pre-Tax Effect of Derivative Instruments not Designated as Hedging Instruments on the Consolidated Condensed Statements of 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 nine months ended July 31, 2021 and 2020 was as follows: Gain/(loss) recognized in earnings on derivative instrument Three months ended July 31 Nine months ended July 31 Location 2021 2020 2021 2020 In millions Foreign currency contracts Interest and other, net $ (33) $ 46 $ (42) $ 63 Other derivatives Interest and other, net (2) 11 4 16 Total $ (35) $ 57 $ (38) $ 79 |
Borrowings (Tables)
Borrowings (Tables) | 9 Months Ended |
Jul. 31, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of Notes Payable and Short-Term Borrowings | Notes Payable and Short-Term Borrowings As of July 31, 2021 As of October 31, 2020 Amount Weighted-Average Amount Weighted-Average In millions Current portion of long-term debt $ 181 3.3 % $ 633 4.0 % Notes payable to banks, lines of credit and other 33 1.6 % 41 1.6 % $ 214 $ 674 |
Schedule of Long-Term Debt | Long-Term Debt As of July 31, 2021 October 31, 2020 In millions U.S. Dollar Global Notes (1) 2009 Shelf Registration Statement: $1,000 issued at discount to par at a price of 99.816% in September 2011 at 4.375%, due September 2021 $ — $ 412 $1,500 issued at discount to par at a price of 99.707% in December 2011 at 4.65%, due December 2021 — 586 $500 issued at discount to par at a price of 99.771% in March 2012 at 4.05%, due September 2022 499 499 $1,200 issued at discount to par at a price of 99.863% in September 2011 at 6.00%, due September 2041 1,199 1,199 2019 Shelf Registration Statement: $1,150 issued at discount to par at a price of 99.769% in June 2020 at 2.2%, due June 2025 1,148 1,148 $1,000 issued at discount to par at a price of 99.718% in June 2020 at 3.0%, due June 2027 997 997 $850 issued at discount to par at a price of 99.790% in June 2020 at 3.4%, due June 2030 848 848 $1,000 issued at discount to par at a price of 99.808% in June 2021 at 1.45%, due June 2026 999 — $1,000 issued at discount to par at a price of 99.573% in June 2021 at 2.65%, due June 2031 996 — 6,686 5,689 Other borrowings at 0.51-9.00%, due in calendar years 2021-2028 451 522 Fair value adjustment related to hedged debt (2) 2 Unamortized debt issuance cost (56) (37) Current portion of long-term debt (181) (633) Total long-term debt $ 6,898 $ 5,543 (1) HP may redeem some or all of the fixed-rate U.S. Dollar Global Notes at any time in accordance with the terms thereof. The U.S. Dollar Global Notes are senior unsecured debt. |
Stockholders' Deficit (Tables)
Stockholders' Deficit (Tables) | 9 Months Ended |
Jul. 31, 2021 | |
Stockholders' Equity Note [Abstract] | |
Schedule of Tax Effects Related to Other Comprehensive (Loss) Income | Tax effects related to Other Comprehensive Income (Loss) Three months ended July 31 Nine months ended July 31 2021 2020 2021 2020 In millions Tax effect on change in unrealized components of available-for-sale debt securities: Tax provision on unrealized gains arising during the period $ — $ — $ (1) $ — Tax effect on change in unrealized components of cash flow hedges: Tax (provision) benefit on unrealized gains (losses) arising during the period (22) 83 18 34 Tax (benefit) provision on losses (gains) reclassified into earnings (4) 25 (25) 51 (26) 108 (7) 85 Tax effect on change in unrealized components of defined benefit plans: Tax benefit (provision) on (losses) gains arising during the period — 1 (11) 1 Tax benefit on amortization of actuarial loss and prior service benefit (4) (5) (14) (15) (4) (4) (25) (14) Tax effect on change in cumulative translation adjustment (2) — (8) — Tax (provision) benefit on other comprehensive income (loss) $ (32) $ 104 $ (41) $ 71 |
Schedule of Changes and Reclassifications Related to Other Comprehensive Income, Net of Taxes | Changes and reclassifications related to Other Comprehensive Income (Loss), net of taxes Three months ended July 31 Nine months ended July 31 2021 2020 2021 2020 In millions Other comprehensive income (loss), net of taxes: Change in unrealized components of available-for-sale debt securities: Unrealized gains arising during the period $ 1 $ 2 $ 4 $ 1 Change in unrealized components of cash flow hedges: Unrealized gains (losses) arising during the period 111 (480) (236) (238) Losses (gains) reclassified into earnings 60 (105) 237 (191) 171 (585) 1 (429) Change in unrealized components of defined benefit plans: (Losses) gains arising during the period (1) (4) 29 (5) Amortization of actuarial loss and prior service benefit (1) 16 15 48 46 Curtailments, settlements and other — 2 1 3 15 13 78 44 Change in cumulative translation adjustment — 15 27 4 Other comprehensive income (loss), net of taxes $ 187 $ (555) $ 110 $ (380) (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”. |
Schedule of Accumulated Other Comprehensive Loss, Net of Taxes | The components of Accumulated other comprehensive loss, net of taxes and changes were as follows: Nine months ended July 31, 2021 Net unrealized Net unrealized (losses) gains on cash Unrealized Change in cumulative Accumulated In millions Balance at beginning of period $ 11 $ (66) $ (1,190) $ 2 $ (1,243) Other comprehensive income (loss) before reclassifications 4 (236) 29 27 (176) Reclassifications of losses into earnings — 237 48 — 285 Reclassifications of settlements into earnings — — 1 — 1 Balance at end of period $ 15 $ (65) $ (1,112) $ 29 $ (1,133) |
Net Earnings Per Share (Tables)
Net Earnings Per Share (Tables) | 9 Months Ended |
Jul. 31, 2021 | |
Earnings Per Share [Abstract] | |
Basic and Diluted Net Earnings Per Share Calculations | A reconciliation of the number of shares used for basic and diluted net EPS calculations is as follows: Three months ended July 31 Nine months ended July 31 2021 2020 2021 2020 In millions, except per share amounts Numerator: Net earnings $ 1,108 $ 734 $ 3,404 $ 2,176 Denominator: Weighted-average shares used to compute basic net EPS 1,185 1,417 1,235 1,435 Dilutive effect of employee stock plans 14 6 12 6 Weighted-average shares used to compute diluted net EPS 1,199 1,423 1,247 1,441 Net earnings per share: Basic $ 0.94 $ 0.52 $ 2.76 $ 1.52 Diluted $ 0.92 $ 0.52 $ 2.73 $ 1.51 Anti-dilutive weighted-average stock-based compensation awards (1) — 15 2 13 (1) HP excludes from the calculation of diluted net EPS stock options and restricted stock units where the assumed proceeds exceed the average market price, because their effect would be anti-dilutive. The assumed proceeds of a stock option include the sum of its exercise price, and average unrecognized compensation cost. The assumed proceeds of a restricted stock unit represent unrecognized compensation cost. |
Guarantees, Indemnifications _2
Guarantees, Indemnifications and Warranties (Tables) | 9 Months Ended |
Jul. 31, 2021 | |
Guarantees [Abstract] | |
Changes in Aggregate Product Warranty Liabilities and Changes | HP’s aggregate product warranty liabilities and changes were as follows: Nine months ended July 31, 2021 In millions Balance at beginning of period $ 993 Accruals for warranties issued 753 Adjustments related to pre-existing warranties (including changes in estimates) 16 Settlements made (in cash or in kind) (777) Balance at end of period $ 985 |
Commitments (Tables)
Commitments (Tables) | 9 Months Ended |
Jul. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Future Unconditional Purchase Obligations | As of July 31, 2021, unconditional purchase obligations were as follows: Fiscal year In millions 2021 (1) $ 692 2022 2,328 2023 2,276 2024 1,431 2025 70 Thereafter 18 Total $ 6,815 (1) Represents expected unconditional purchase obligations for the remaining three months of the fiscal year 2021. |
Acquisitions (Tables)
Acquisitions (Tables) | 9 Months Ended |
Jul. 31, 2021 | |
Business Combination and Asset Acquisition [Abstract] | |
Schedule of Preliminary Purchase Price Allocation | In millions Goodwill $ 101 Amortizable intangible assets 208 Net assets assumed 103 Total fair value of consideration $ 412 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 9 Months Ended |
Jul. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Intangible Assets | HP’s acquired intangible assets were composed of: As of July 31, 2021 As of October 31, 2020 Gross Accumulated Amortization Net Gross Accumulated Amortization Net In millions Customer contracts, customer lists and distribution agreements $ 479 $ 189 $ 290 $ 382 $ 149 $ 233 Technology and patents 764 399 365 621 332 289 Trade name and trademarks 98 12 86 26 8 18 Total intangible assets $ 1,341 $ 600 $ 741 $ 1,029 $ 489 $ 540 The weighted-average useful lives of intangible assets acquired during the period are as follows: Weighted-Average Useful Life (in years) Customer contracts and customer lists 2 Technology and patents 7 Trade name and trademarks 15 |
Schedule of Estimated Future Amortization Expense | As of July 31, 2021, estimated future amortization expense related to intangible assets was as follows: Fiscal year In millions 2021 (1) $ 49 2022 184 2023 139 2024 105 2025 62 Thereafter 202 Total $ 741 (1) Represents expected amortization for the remaining three months of the fiscal year 2021. |
Segment Information - Narrative
Segment Information - Narrative (Details) | 9 Months Ended |
Jul. 31, 2021segment | |
Segment Reporting [Abstract] | |
Number of reportable segments | 3 |
Segment Information - Schedule
Segment Information - Schedule of Reconciliation of Segment Operating Results to HP Consolidated Results (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2021 | Jul. 31, 2020 | Jul. 31, 2021 | Jul. 31, 2020 | |
Segment Information | ||||
Net revenue | $ 15,289 | $ 14,294 | $ 46,812 | $ 41,381 |
Total segment earnings from operations | 1,381 | 779 | 4,064 | 2,470 |
Restructuring and other charges | (56) | (59) | (216) | (431) |
Acquisition-related charges | (24) | (11) | (40) | (14) |
Amortization of intangible assets | (42) | (29) | (103) | (84) |
Interest and other, net | (55) | (28) | (106) | (15) |
Total earnings before taxes | 1,326 | 751 | 3,958 | 2,455 |
Operating segments | ||||
Segment Information | ||||
Net revenue | 15,288 | 14,294 | 46,814 | 41,382 |
Total segment earnings from operations | 1,706 | 1,035 | 5,061 | 3,524 |
Other | ||||
Segment Information | ||||
Net revenue | 1 | 0 | (2) | (1) |
Corporate and unallocated costs and other | (134) | (108) | (378) | (304) |
Stock-based compensation expense | (69) | (49) | (260) | (221) |
Restructuring and other charges | (56) | (59) | (216) | (431) |
Acquisition-related charges | (24) | (11) | (40) | (14) |
Amortization of intangible assets | (42) | (29) | (103) | (84) |
Interest and other, net | (55) | (28) | (106) | (15) |
Personal Systems | Operating segments | ||||
Segment Information | ||||
Net revenue | 10,406 | 10,360 | 31,564 | 28,565 |
Total segment earnings from operations | 869 | 570 | 2,337 | 1,784 |
Printing | Operating segments | ||||
Segment Information | ||||
Net revenue | 4,882 | 3,933 | 15,249 | 12,815 |
Total segment earnings from operations | 857 | 480 | 2,806 | 1,782 |
Corporate Investments | Operating segments | ||||
Segment Information | ||||
Net revenue | 0 | 1 | 1 | 2 |
Total segment earnings from operations | (20) | (15) | (82) | (42) |
Notebooks | Personal Systems | Operating segments | ||||
Segment Information | ||||
Net revenue | 7,328 | 7,304 | 22,183 | 18,361 |
Desktops | Personal Systems | Operating segments | ||||
Segment Information | ||||
Net revenue | 2,246 | 2,221 | 6,871 | 7,553 |
Workstations | Personal Systems | Operating segments | ||||
Segment Information | ||||
Net revenue | 388 | 428 | 1,177 | 1,461 |
Other | Personal Systems | Operating segments | ||||
Segment Information | ||||
Net revenue | 444 | 407 | 1,333 | 1,190 |
Supplies | Printing | Operating segments | ||||
Segment Information | ||||
Net revenue | 3,092 | 2,573 | 9,575 | 8,455 |
Commercial | Printing | Operating segments | ||||
Segment Information | ||||
Net revenue | 1,070 | 732 | 3,112 | 2,616 |
Consumer | Printing | Operating segments | ||||
Segment Information | ||||
Net revenue | $ 720 | $ 628 | $ 2,562 | $ 1,744 |
Restructuring and Other Charg_3
Restructuring and Other Charges - Summary of Cost Saving Plan Activities (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |
Jul. 31, 2021 | Jul. 31, 2021 | Jul. 31, 2020 | |
Restructuring Reserve [Roll Forward] | |||
Accrued balance, beginning of the period | $ 67 | $ 142 | |
Charges | $ 48 | 199 | 331 |
Cash payments | (148) | (309) | |
Non-cash and other adjustments | (32) | (51) | |
Accrued balance, beginning of the period | 86 | 86 | 113 |
Total costs incurred to date as of July 31, 2021 | 2,454 | 2,454 | |
Reflected in Consolidated Condensed Balance Sheets | |||
Other current liabilities | 86 | 86 | |
Fiscal 2020 Plan | Severance and EER | |||
Restructuring Reserve [Roll Forward] | |||
Accrued balance, beginning of the period | 55 | 76 | |
Charges | 28 | 164 | 325 |
Cash payments | (132) | (256) | |
Non-cash and other adjustments | (1) | (48) | |
Accrued balance, beginning of the period | 86 | 86 | 97 |
Total costs incurred to date as of July 31, 2021 | 592 | 592 | |
Reflected in Consolidated Condensed Balance Sheets | |||
Other current liabilities | 86 | 86 | |
Fiscal 2020 Plan | Non-labor | |||
Restructuring Reserve [Roll Forward] | |||
Accrued balance, beginning of the period | 0 | 0 | |
Charges | 20 | 35 | 5 |
Cash payments | (4) | (5) | |
Non-cash and other adjustments | (31) | 0 | |
Accrued balance, beginning of the period | 0 | 0 | 0 |
Total costs incurred to date as of July 31, 2021 | 45 | 45 | |
Reflected in Consolidated Condensed Balance Sheets | |||
Other current liabilities | 0 | 0 | |
Fiscal 2020 Plan | Healthcare and medical savings account benefits | |||
Restructuring Reserve [Roll Forward] | |||
Non-cash and other adjustments | 44 | ||
Other prior-year Plans | |||
Restructuring Reserve [Roll Forward] | |||
Accrued balance, beginning of the period | 12 | 66 | |
Charges | 0 | 1 | |
Cash payments | (12) | (48) | |
Non-cash and other adjustments | 0 | (3) | |
Accrued balance, beginning of the period | 0 | 0 | $ 16 |
Total costs incurred to date as of July 31, 2021 | 1,817 | 1,817 | |
Reflected in Consolidated Condensed Balance Sheets | |||
Other current liabilities | $ 0 | $ 0 |
Restructuring and Other Charg_4
Restructuring and Other Charges - Narrative (Details) employee in Thousands, $ in Millions | Sep. 30, 2019USD ($)employee | Jul. 31, 2021USD ($) | Jul. 31, 2020USD ($) | Jul. 31, 2021USD ($) | Jul. 31, 2020USD ($) |
Restructuring Cost and Reserve [Line Items] | |||||
Other charges | $ 8 | $ 13 | $ 17 | $ 100 | |
Fiscal 2020 Plan | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Estimated pre-tax charges | $ 1,000 | ||||
Minimum | Fiscal 2020 Plan | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Expected positions to be eliminated | employee | 7 | ||||
Maximum | Fiscal 2020 Plan | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Expected positions to be eliminated | employee | 9 | ||||
Severance and EER | Fiscal 2020 Plan | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Estimated pre-tax charges | $ 800 |
Retirement and Post-Retiremen_3
Retirement and Post-Retirement Benefit Plans - Schedule of Pension and Post-Retirement Benefit (Credit) Cost (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2021 | Jul. 31, 2020 | Jul. 31, 2021 | Jul. 31, 2020 | |
Post-Retirement Benefit Plans | ||||
Retirement and post-retirement benefit plans | ||||
Service cost | $ 0 | $ 0 | $ 1 | $ 1 |
Interest cost | 2 | 3 | 6 | 8 |
Expected return on plan assets | (5) | (6) | (17) | (17) |
Amortization and deferrals: | ||||
Actuarial loss (gain) | (4) | (3) | (12) | (8) |
Prior service benefit | (2) | (3) | (8) | (9) |
Net periodic benefit (credit) cost | (9) | (9) | (30) | (25) |
Settlement loss | 0 | 0 | 0 | 0 |
Special termination benefit cost | 0 | 44 | ||
Total periodic benefit (credit) cost | (9) | (9) | (30) | 19 |
U.S. | Defined Benefit Plans | ||||
Retirement and post-retirement benefit plans | ||||
Service cost | 0 | 0 | 0 | 0 |
Interest cost | 76 | 103 | 228 | 309 |
Expected return on plan assets | (127) | (175) | (381) | (525) |
Amortization and deferrals: | ||||
Actuarial loss (gain) | 14 | 16 | 44 | 48 |
Prior service benefit | 0 | 0 | 0 | 0 |
Net periodic benefit (credit) cost | (37) | (56) | (109) | (168) |
Settlement loss | 0 | 2 | 1 | 3 |
Special termination benefit cost | 0 | 0 | ||
Total periodic benefit (credit) cost | (37) | (54) | (108) | (165) |
Non-U.S. | Defined Benefit Plans | ||||
Retirement and post-retirement benefit plans | ||||
Service cost | 16 | 16 | 50 | 47 |
Interest cost | 5 | 4 | 14 | 13 |
Expected return on plan assets | (13) | (10) | (37) | (31) |
Amortization and deferrals: | ||||
Actuarial loss (gain) | 13 | 11 | 40 | 32 |
Prior service benefit | (1) | (1) | (2) | (2) |
Net periodic benefit (credit) cost | 20 | 20 | 65 | 59 |
Settlement loss | 0 | 0 | 0 | 0 |
Special termination benefit cost | 0 | 0 | ||
Total periodic benefit (credit) cost | $ 20 | $ 20 | $ 65 | $ 59 |
Retirement and Post-Retiremen_4
Retirement and Post-Retirement Benefit Plans - Narrative (Details) employee in Thousands, $ in Millions | 1 Months Ended | 3 Months Ended | 9 Months Ended | ||
Aug. 31, 2021USD ($)employee | Jul. 31, 2021USD ($) | Jul. 31, 2020USD ($) | Jul. 31, 2021USD ($) | Jul. 31, 2020USD ($) | |
Post-Retirement Benefit Plans | |||||
Retirement and post-retirement benefit plans | |||||
Anticipated contributions | $ 5 | $ 5 | |||
Contributions to benefit plans | 3 | ||||
Settlement gain | 0 | $ 0 | 0 | $ 0 | |
Non-U.S. | Defined Benefit Plans | |||||
Retirement and post-retirement benefit plans | |||||
Anticipated contributions | 77 | 77 | |||
Contributions to benefit plans | 50 | ||||
Settlement gain | 0 | 0 | 0 | 0 | |
U.S. | Non-qualified plan | |||||
Retirement and post-retirement benefit plans | |||||
Anticipated contributions | 34 | 34 | |||
Contributions to benefit plans | 21 | ||||
U.S. | Defined Benefit Plans | |||||
Retirement and post-retirement benefit plans | |||||
Settlement gain | $ 0 | $ (2) | $ (1) | $ (3) | |
U.S. | Defined Benefit Plans | Subsequent event | |||||
Retirement and post-retirement benefit plans | |||||
Decrease in obligations | $ 5,200 | ||||
Number of employees | employee | 41 | ||||
Settlement gain | $ 40 |
Taxes on Earnings (Details)
Taxes on Earnings (Details) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2021USD ($)country | Jul. 31, 2020USD ($) | Jul. 31, 2021USD ($)country | Jul. 31, 2020USD ($) | |
Income Tax Disclosure [Abstract] | ||||
Effective tax rate (percent) | 16.50% | 2.20% | 14.00% | 11.40% |
Net tax benefit | $ 21 | $ 116 | $ 150 | $ 182 |
Tax benefits related to restructuring charges | 9 | 20 | 45 | 75 |
Tax benefits related to filing of tax returns | 23 | 30 | ||
Tax benefits related to audit settlements | 102 | 10 | 143 | |
Tax benefits related to internal reorganization | 89 | |||
Uncertain tax position charges | 13 | 3 | 25 | 54 |
Tax benefits related to acquisition charges | 4 | 20 | ||
Unrecognized tax benefits | 822 | 822 | ||
Unrecognized tax benefits that would affect effective tax rate if realized | 653 | 653 | ||
Accrued income tax payable for interest and penalties | 70 | $ 37 | $ 70 | $ 37 |
Likelihood of no resolution period | 12 months | |||
Reasonably possible decrease in existing unrecognized tax benefits within the next 12 months | $ 98 | $ 98 | ||
Other countries with income tax jurisdiction | country | 60 | 60 |
Supplementary Financial Infor_3
Supplementary Financial Information - Allowance for Doubtful Accounts (Details) $ in Millions | 9 Months Ended |
Jul. 31, 2021USD ($) | |
Accounts Receivable, Allowance for Credit Loss [Roll Forward] | |
Balance at beginning of period | $ 122 |
Current-period allowance for credit losses | 9 |
Deductions, net of recoveries | (14) |
Balance at end of period | $ 117 |
Supplementary Financial Infor_4
Supplementary Financial Information - Schedule of Transferred Trade Receivables Not Collected from Third Parties (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2021 | Jul. 31, 2020 | Jul. 31, 2021 | Jul. 31, 2020 | |
Trade Receivables Sold and Cash Received [Roll Forward] | ||||
Balance at beginning of period | $ 212 | $ 124 | $ 188 | $ 235 |
Trade receivables sold | 2,667 | 2,231 | 9,155 | 7,411 |
Cash receipts | (2,711) | (2,254) | (9,181) | (7,544) |
Foreign currency and other | (2) | 8 | 4 | 7 |
Balance at end of period | $ 166 | $ 109 | $ 166 | $ 109 |
Supplementary Financial Infor_5
Supplementary Financial Information - Inventory (Details) - USD ($) $ in Millions | Jul. 31, 2021 | Oct. 31, 2020 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Finished goods | $ 4,187 | $ 3,662 |
Purchased parts and fabricated assemblies | 3,978 | 2,301 |
Inventory | $ 8,165 | $ 5,963 |
Supplementary Financial Infor_6
Supplementary Financial Information - Other Current Assets (Details) - USD ($) $ in Millions | Jul. 31, 2021 | Oct. 31, 2020 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Supplier and other receivables | $ 2,218 | $ 2,092 |
Prepaid and other current assets | 1,031 | 1,104 |
Value-added taxes receivable | 834 | 970 |
Available-for-sale investments | 8 | 274 |
Other current assets | $ 4,091 | $ 4,440 |
Supplementary Financial Infor_7
Supplementary Financial Information - Property Plant & Equipment (Details) - USD ($) $ in Millions | Jul. 31, 2021 | Oct. 31, 2020 |
Property, Plant and Equipment, Net | ||
Property, plant and equipment, gross | $ 7,427 | $ 7,341 |
Accumulated depreciation | (4,927) | (4,714) |
Property, plant and equipment, net | 2,500 | 2,627 |
Land, buildings and leasehold improvements | ||
Property, Plant and Equipment, Net | ||
Property, plant and equipment, gross | 2,168 | 2,066 |
Machinery and equipment, including equipment held for lease | ||
Property, Plant and Equipment, Net | ||
Property, plant and equipment, gross | $ 5,259 | $ 5,275 |
Supplementary Financial Infor_8
Supplementary Financial Information - Other Non-Current Assets (Details) - USD ($) $ in Millions | Jul. 31, 2021 | Oct. 31, 2020 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Deferred tax assets | $ 2,581 | $ 2,515 |
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible Enumeration] | Other non-current assets | Other non-current assets |
Right-of-use assets from operating leases, net | $ 1,114 | $ 1,107 |
Deposits and prepaid | 757 | 337 |
Intangible assets | 741 | 540 |
Other | 599 | 527 |
Other non-current assets | $ 5,792 | $ 5,026 |
Supplementary Financial Infor_9
Supplementary Financial Information - Other Current Liabilities (Details) - USD ($) $ in Millions | Jul. 31, 2021 | Oct. 31, 2020 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Sales and marketing programs | $ 3,101 | $ 3,185 |
Employee compensation and benefit | 1,462 | 1,194 |
Deferred revenue | 1,335 | 1,208 |
Other accrued taxes | 1,020 | 1,051 |
Warranty | $ 752 | $ 746 |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible Enumeration] | Other accrued liabilities | Other accrued liabilities |
Operating lease liabilities | $ 330 | $ 275 |
Tax liability | 271 | 223 |
Other | 3,284 | 2,960 |
Other accrued liabilities | $ 11,555 | $ 10,842 |
Supplementary Financial Info_10
Supplementary Financial Information - Other Non-Current Liabilities (Details) - USD ($) $ in Millions | Jul. 31, 2021 | Oct. 31, 2020 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Pension, post-retirement, and post-employment liabilities | $ 1,342 | $ 1,576 |
Deferred revenue | $ 1,043 | $ 1,072 |
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible Enumeration] | Other non-current liabilities | Other non-current liabilities |
Operating lease liabilities | $ 878 | $ 904 |
Tax liability | 751 | 746 |
Deferred tax liability | 47 | 25 |
Other | 839 | 823 |
Other non-current liabilities | $ 4,900 | $ 5,146 |
Supplementary Financial Info_11
Supplementary Financial Information - Interest and Other, Net (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2021 | Jul. 31, 2020 | Jul. 31, 2021 | Jul. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||
Interest expense on borrowings | $ (68) | $ (55) | $ (193) | $ (176) |
Loss on extinguishment of debt | (16) | (40) | (16) | (40) |
Other, net | 29 | 67 | 103 | 201 |
Interest and other, net | $ (55) | $ (28) | $ (106) | $ (15) |
Supplementary Financial Info_12
Supplementary Financial Information - Disaggregation of revenue (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2021 | Jul. 31, 2020 | Jul. 31, 2021 | Jul. 31, 2020 | |
Disaggregation of Revenue [Line Items] | ||||
Total net revenue | $ 15,289 | $ 14,294 | $ 46,812 | $ 41,381 |
Americas | ||||
Disaggregation of Revenue [Line Items] | ||||
Total net revenue | 7,006 | 6,229 | 20,746 | 17,393 |
Europe, Middle East and Africa | ||||
Disaggregation of Revenue [Line Items] | ||||
Total net revenue | 5,004 | 4,725 | 16,267 | 14,611 |
Asia-Pacific and Japan | ||||
Disaggregation of Revenue [Line Items] | ||||
Total net revenue | $ 3,279 | $ 3,340 | $ 9,799 | $ 9,377 |
Supplementary Financial Info_13
Supplementary Financial Information - Value of Remaining Performance Obligations (Details) $ in Billions | Jul. 31, 2021USD ($) |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Remaining performance obligations | $ 3.8 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-08-01 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Remaining performance obligations | $ 1.8 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligations period | 12 months |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-08-01 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Remaining performance obligations | $ 2 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligations period |
Supplementary Financial Info_14
Supplementary Financial Information - Costs of Obtaining Contracts (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |
Jul. 31, 2021 | Jul. 31, 2021 | Oct. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||
Contract liability | $ 2,400 | $ 2,400 | $ 2,200 |
Revenue recognized | $ 900 | ||
Increase in estimate of transaction price | $ 350 |
Fair Value (Details)
Fair Value (Details) - USD ($) $ in Millions | Jul. 31, 2021 | Oct. 31, 2020 |
Assets: | ||
Cash Equivalents | $ 2,177 | $ 3,932 |
Derivative Instruments | 191 | 195 |
Liabilities: | ||
Derivative Instruments | 231 | 262 |
Fair value, short- and long-term debt | 7,700 | 6,700 |
Carrying value, short- and long-term debt | 7,100 | 6,200 |
Corporate debt | ||
Assets: | ||
Cash Equivalents | 1,407 | 1,700 |
Financial institution instruments | ||
Assets: | ||
Cash Equivalents | 0 | 59 |
Government debt | ||
Assets: | ||
Cash Equivalents | 770 | 2,173 |
Fair Value Measured on a Recurring Basis | ||
Assets: | ||
Total assets | 2,439 | 4,459 |
Liabilities: | ||
Total liabilities | 231 | 262 |
Fair Value Measured on a Recurring Basis | Corporate debt | ||
Assets: | ||
Cash Equivalents | 1,407 | 1,700 |
Available-for-Sale Investments | 0 | 169 |
Fair Value Measured on a Recurring Basis | Financial institution instruments | ||
Assets: | ||
Cash Equivalents | 0 | 59 |
Available-for-Sale Investments | 8 | 32 |
Fair Value Measured on a Recurring Basis | Government debt | ||
Assets: | ||
Cash Equivalents | 770 | 2,173 |
Available-for-Sale Investments | 0 | 73 |
Fair Value Measured on a Recurring Basis | Mutual funds | ||
Assets: | ||
Available-for-Sale Investments | 63 | 58 |
Fair Value Measured on a Recurring Basis | Interest rate contracts | ||
Assets: | ||
Derivative Instruments | 2 | 4 |
Liabilities: | ||
Derivative Instruments | 6 | 3 |
Fair Value Measured on a Recurring Basis | Foreign currency contracts | ||
Assets: | ||
Derivative Instruments | 188 | 191 |
Liabilities: | ||
Derivative Instruments | 224 | 256 |
Fair Value Measured on a Recurring Basis | Other derivatives | ||
Assets: | ||
Derivative Instruments | 1 | 0 |
Liabilities: | ||
Derivative Instruments | 1 | 3 |
Fair Value Measured on a Recurring Basis | Level 1 | ||
Assets: | ||
Total assets | 776 | 1,997 |
Liabilities: | ||
Total liabilities | 0 | 0 |
Fair Value Measured on a Recurring Basis | Level 1 | Corporate debt | ||
Assets: | ||
Cash Equivalents | 0 | 0 |
Available-for-Sale Investments | 0 | 0 |
Fair Value Measured on a Recurring Basis | Level 1 | Financial institution instruments | ||
Assets: | ||
Cash Equivalents | 0 | 0 |
Available-for-Sale Investments | 0 | 0 |
Fair Value Measured on a Recurring Basis | Level 1 | Government debt | ||
Assets: | ||
Cash Equivalents | 770 | 1,992 |
Available-for-Sale Investments | 0 | 0 |
Fair Value Measured on a Recurring Basis | Level 1 | Mutual funds | ||
Assets: | ||
Available-for-Sale Investments | 6 | 5 |
Fair Value Measured on a Recurring Basis | Level 1 | Interest rate contracts | ||
Assets: | ||
Derivative Instruments | 0 | 0 |
Liabilities: | ||
Derivative Instruments | 0 | 0 |
Fair Value Measured on a Recurring Basis | Level 1 | Foreign currency contracts | ||
Assets: | ||
Derivative Instruments | 0 | 0 |
Liabilities: | ||
Derivative Instruments | 0 | 0 |
Fair Value Measured on a Recurring Basis | Level 1 | Other derivatives | ||
Assets: | ||
Derivative Instruments | 0 | 0 |
Liabilities: | ||
Derivative Instruments | 0 | 0 |
Fair Value Measured on a Recurring Basis | Level 2 | ||
Assets: | ||
Total assets | 1,663 | 2,462 |
Liabilities: | ||
Total liabilities | 231 | 262 |
Fair Value Measured on a Recurring Basis | Level 2 | Corporate debt | ||
Assets: | ||
Cash Equivalents | 1,407 | 1,700 |
Available-for-Sale Investments | 0 | 169 |
Fair Value Measured on a Recurring Basis | Level 2 | Financial institution instruments | ||
Assets: | ||
Cash Equivalents | 0 | 59 |
Available-for-Sale Investments | 8 | 32 |
Fair Value Measured on a Recurring Basis | Level 2 | Government debt | ||
Assets: | ||
Cash Equivalents | 0 | 181 |
Available-for-Sale Investments | 0 | 73 |
Fair Value Measured on a Recurring Basis | Level 2 | Mutual funds | ||
Assets: | ||
Available-for-Sale Investments | 57 | 53 |
Fair Value Measured on a Recurring Basis | Level 2 | Interest rate contracts | ||
Assets: | ||
Derivative Instruments | 2 | 4 |
Liabilities: | ||
Derivative Instruments | 6 | 3 |
Fair Value Measured on a Recurring Basis | Level 2 | Foreign currency contracts | ||
Assets: | ||
Derivative Instruments | 188 | 191 |
Liabilities: | ||
Derivative Instruments | 224 | 256 |
Fair Value Measured on a Recurring Basis | Level 2 | Other derivatives | ||
Assets: | ||
Derivative Instruments | 1 | 0 |
Liabilities: | ||
Derivative Instruments | 1 | 3 |
Fair Value Measured on a Recurring Basis | Level 3 | ||
Assets: | ||
Total assets | 0 | 0 |
Liabilities: | ||
Total liabilities | 0 | 0 |
Fair Value Measured on a Recurring Basis | Level 3 | Corporate debt | ||
Assets: | ||
Cash Equivalents | 0 | 0 |
Available-for-Sale Investments | 0 | 0 |
Fair Value Measured on a Recurring Basis | Level 3 | Financial institution instruments | ||
Assets: | ||
Cash Equivalents | 0 | 0 |
Available-for-Sale Investments | 0 | 0 |
Fair Value Measured on a Recurring Basis | Level 3 | Government debt | ||
Assets: | ||
Cash Equivalents | 0 | 0 |
Available-for-Sale Investments | 0 | 0 |
Fair Value Measured on a Recurring Basis | Level 3 | Mutual funds | ||
Assets: | ||
Available-for-Sale Investments | 0 | 0 |
Fair Value Measured on a Recurring Basis | Level 3 | Interest rate contracts | ||
Assets: | ||
Derivative Instruments | 0 | 0 |
Liabilities: | ||
Derivative Instruments | 0 | 0 |
Fair Value Measured on a Recurring Basis | Level 3 | Foreign currency contracts | ||
Assets: | ||
Derivative Instruments | 0 | 0 |
Liabilities: | ||
Derivative Instruments | 0 | 0 |
Fair Value Measured on a Recurring Basis | Level 3 | Other derivatives | ||
Assets: | ||
Derivative Instruments | 0 | 0 |
Liabilities: | ||
Derivative Instruments | $ 0 | $ 0 |
Financial Instruments - Schedul
Financial Instruments - Schedule of Cash Equivalents and Available-for-Sale Investments (Details) - USD ($) $ in Millions | Jul. 31, 2021 | Oct. 31, 2020 |
Cash Equivalents: | ||
Cost | $ 2,177 | $ 3,932 |
Gross Unrealized Gain | 0 | 0 |
Gross Unrealized Loss | 0 | 0 |
Fair Value | 2,177 | 3,932 |
Available-for-Sale Investments: | ||
Cost | 52 | 316 |
Gross Unrealized Gain | 19 | 16 |
Gross Unrealized Loss | 0 | 0 |
Fair Value | 71 | 332 |
Total cash equivalents and available-for-sale investments, Cost | 2,229 | 4,248 |
Total cash equivalents and available-for-sale investments, Gross Unrealized Gain | 19 | 16 |
Total cash equivalents and available-for-sale investments, Gross Unrealized Loss | 0 | 0 |
Total cash equivalents and available-for-sale investments, Fair Value | 2,248 | 4,264 |
Corporate debt | ||
Cash Equivalents: | ||
Cost | 1,407 | 1,700 |
Gross Unrealized Gain | 0 | 0 |
Gross Unrealized Loss | 0 | 0 |
Fair Value | 1,407 | 1,700 |
Available-for-Sale Investments: | ||
Debt securities, Cost | 0 | 169 |
Debt securities, Gross Unrealized Gain | 0 | 0 |
Debt securities, Gross Unrealized Loss | 0 | 0 |
Debt securities, fair value | 0 | 169 |
Financial institution instruments | ||
Cash Equivalents: | ||
Cost | 0 | 59 |
Gross Unrealized Gain | 0 | 0 |
Gross Unrealized Loss | 0 | 0 |
Fair Value | 0 | 59 |
Available-for-Sale Investments: | ||
Debt securities, Cost | 8 | 32 |
Debt securities, Gross Unrealized Gain | 0 | 0 |
Debt securities, Gross Unrealized Loss | 0 | 0 |
Debt securities, fair value | 8 | 32 |
Government debt | ||
Cash Equivalents: | ||
Cost | 770 | 2,173 |
Gross Unrealized Gain | 0 | 0 |
Gross Unrealized Loss | 0 | 0 |
Fair Value | 770 | 2,173 |
Available-for-Sale Investments: | ||
Debt securities, Cost | 0 | 73 |
Debt securities, Gross Unrealized Gain | 0 | 0 |
Debt securities, Gross Unrealized Loss | 0 | 0 |
Debt securities, fair value | 0 | 73 |
Mutual funds | ||
Available-for-Sale Investments: | ||
Equity securities, Cost | 44 | 42 |
Equity securities, Gross Unrealized Gain | 19 | 16 |
Equity securities, Gross Unrealized Loss | 0 | 0 |
Equity securities, Fair Value | $ 63 | $ 58 |
Financial Instruments - Sched_2
Financial Instruments - Schedule of Contractual Maturities of Available for-sale Debt Securities (Details) $ in Millions | Jul. 31, 2021USD ($) |
Amortized Cost | |
Due in one year | $ 8 |
Fair Value | |
Due in one year | $ 8 |
Financial Instruments - Narrati
Financial Instruments - Narrative (Details) - USD ($) | 9 Months Ended | ||
Jul. 31, 2021 | Jun. 30, 2021 | Oct. 31, 2020 | |
Derivatives, Fair Value | |||
Fair value of derivatives with credit contingent features in a net liability position | $ 95,000,000 | $ 90,000,000 | |
Period to collateralize | 2 days | ||
Notional amount | $ 23,955,000,000 | 21,997,000,000 | |
Loss expected to be reclassified from Accumulated OCI into earnings in next 12 months | 40,000,000 | ||
$1,150 issued at discount to par at a price of 99.769% in June 2020 at 2.2%, due June 2025 | |||
Derivatives, Fair Value | |||
Face amount of debt instrument | 1,150,000,000 | ||
Interest Rate Swap | |||
Derivatives, Fair Value | |||
Derivative terminated, notional amount | 500,000,000 | ||
Derivative settlement, notional amount | 250,000,000 | ||
Fair value hedges | Interest Rate Swap | |||
Derivatives, Fair Value | |||
Notional amount | $ 375,000,000 | ||
Cash flow hedges | |||
Derivatives, Fair Value | |||
Foreign currency maturity | 12 months | ||
Cash flow hedges | Forward Contracts | |||
Derivatives, Fair Value | |||
Notional amount | $ 1,750,000,000 | ||
Derivative settlement, notional amount | $ 750,000,000 | ||
Other Non-Current Assets | Equity securities in privately held companies | |||
Derivatives, Fair Value | |||
Cost method and other equity investments | $ 53,000,000 | $ 44,000,000 |
Financial Instruments - Sched_3
Financial Instruments - Schedule of Gross Notional and Fair Value of Derivative Financial Instruments in the Consolidated Condensed Balance Sheets (Details) - USD ($) $ in Millions | Jul. 31, 2021 | Oct. 31, 2020 |
Derivatives, Fair Value | ||
Outstanding Gross Notional | $ 23,955 | $ 21,997 |
Gross derivative asset | 191 | 195 |
Gross derivative liability | 231 | 262 |
Other Current Assets | ||
Derivatives, Fair Value | ||
Gross derivative asset | 157 | 165 |
Other Non-Current Assets | ||
Derivatives, Fair Value | ||
Gross derivative asset | 34 | 30 |
Other Current Liabilities | ||
Derivatives, Fair Value | ||
Gross derivative liability | 151 | 222 |
Other Non-Current Liabilities | ||
Derivatives, Fair Value | ||
Gross derivative liability | 80 | 40 |
Derivatives designated as hedging instruments | ||
Derivatives, Fair Value | ||
Outstanding Gross Notional | 18,281 | 16,536 |
Derivatives designated as hedging instruments | Other Current Assets | ||
Derivatives, Fair Value | ||
Gross derivative asset | 142 | 152 |
Derivatives designated as hedging instruments | Other Non-Current Assets | ||
Derivatives, Fair Value | ||
Gross derivative asset | 34 | 30 |
Derivatives designated as hedging instruments | Other Current Liabilities | ||
Derivatives, Fair Value | ||
Gross derivative liability | 135 | 199 |
Derivatives designated as hedging instruments | Other Non-Current Liabilities | ||
Derivatives, Fair Value | ||
Gross derivative liability | 80 | 40 |
Derivatives designated as hedging instruments | Fair value hedges | Interest rate contracts | ||
Derivatives, Fair Value | ||
Outstanding Gross Notional | 750 | 875 |
Derivatives designated as hedging instruments | Fair value hedges | Interest rate contracts | Other Current Assets | ||
Derivatives, Fair Value | ||
Gross derivative asset | 0 | 4 |
Derivatives designated as hedging instruments | Fair value hedges | Interest rate contracts | Other Non-Current Assets | ||
Derivatives, Fair Value | ||
Gross derivative asset | 2 | 0 |
Derivatives designated as hedging instruments | Fair value hedges | Interest rate contracts | Other Current Liabilities | ||
Derivatives, Fair Value | ||
Gross derivative liability | 0 | 0 |
Derivatives designated as hedging instruments | Fair value hedges | Interest rate contracts | Other Non-Current Liabilities | ||
Derivatives, Fair Value | ||
Gross derivative liability | 6 | 3 |
Derivatives designated as hedging instruments | Cash flow hedges | Interest rate contracts | ||
Derivatives, Fair Value | ||
Outstanding Gross Notional | 1,000 | 0 |
Derivatives designated as hedging instruments | Cash flow hedges | Interest rate contracts | Other Current Assets | ||
Derivatives, Fair Value | ||
Gross derivative asset | 0 | 0 |
Derivatives designated as hedging instruments | Cash flow hedges | Interest rate contracts | Other Non-Current Assets | ||
Derivatives, Fair Value | ||
Gross derivative asset | 0 | 0 |
Derivatives designated as hedging instruments | Cash flow hedges | Interest rate contracts | Other Current Liabilities | ||
Derivatives, Fair Value | ||
Gross derivative liability | 0 | 0 |
Derivatives designated as hedging instruments | Cash flow hedges | Interest rate contracts | Other Non-Current Liabilities | ||
Derivatives, Fair Value | ||
Gross derivative liability | 27 | 0 |
Derivatives designated as hedging instruments | Cash flow hedges | Foreign currency contracts | ||
Derivatives, Fair Value | ||
Outstanding Gross Notional | 16,531 | 15,661 |
Derivatives designated as hedging instruments | Cash flow hedges | Foreign currency contracts | Other Current Assets | ||
Derivatives, Fair Value | ||
Gross derivative asset | 142 | 148 |
Derivatives designated as hedging instruments | Cash flow hedges | Foreign currency contracts | Other Non-Current Assets | ||
Derivatives, Fair Value | ||
Gross derivative asset | 32 | 30 |
Derivatives designated as hedging instruments | Cash flow hedges | Foreign currency contracts | Other Current Liabilities | ||
Derivatives, Fair Value | ||
Gross derivative liability | 135 | 199 |
Derivatives designated as hedging instruments | Cash flow hedges | Foreign currency contracts | Other Non-Current Liabilities | ||
Derivatives, Fair Value | ||
Gross derivative liability | 47 | 37 |
Derivatives not designated as hedging instruments | ||
Derivatives, Fair Value | ||
Outstanding Gross Notional | 5,674 | 5,461 |
Derivatives not designated as hedging instruments | Other Current Assets | ||
Derivatives, Fair Value | ||
Gross derivative asset | 15 | 13 |
Derivatives not designated as hedging instruments | Other Non-Current Assets | ||
Derivatives, Fair Value | ||
Gross derivative asset | 0 | 0 |
Derivatives not designated as hedging instruments | Other Current Liabilities | ||
Derivatives, Fair Value | ||
Gross derivative liability | 16 | 23 |
Derivatives not designated as hedging instruments | Other Non-Current Liabilities | ||
Derivatives, Fair Value | ||
Gross derivative liability | 0 | 0 |
Derivatives not designated as hedging instruments | Foreign currency contracts | ||
Derivatives, Fair Value | ||
Outstanding Gross Notional | 5,519 | 5,319 |
Derivatives not designated as hedging instruments | Foreign currency contracts | Other Current Assets | ||
Derivatives, Fair Value | ||
Gross derivative asset | 14 | 13 |
Derivatives not designated as hedging instruments | Foreign currency contracts | Other Non-Current Assets | ||
Derivatives, Fair Value | ||
Gross derivative asset | 0 | 0 |
Derivatives not designated as hedging instruments | Foreign currency contracts | Other Current Liabilities | ||
Derivatives, Fair Value | ||
Gross derivative liability | 15 | 20 |
Derivatives not designated as hedging instruments | Foreign currency contracts | Other Non-Current Liabilities | ||
Derivatives, Fair Value | ||
Gross derivative liability | 0 | 0 |
Derivatives not designated as hedging instruments | Other derivatives | ||
Derivatives, Fair Value | ||
Outstanding Gross Notional | 155 | 142 |
Derivatives not designated as hedging instruments | Other derivatives | Other Current Assets | ||
Derivatives, Fair Value | ||
Gross derivative asset | 1 | 0 |
Derivatives not designated as hedging instruments | Other derivatives | Other Non-Current Assets | ||
Derivatives, Fair Value | ||
Gross derivative asset | 0 | 0 |
Derivatives not designated as hedging instruments | Other derivatives | Other Current Liabilities | ||
Derivatives, Fair Value | ||
Gross derivative liability | 1 | 3 |
Derivatives not designated as hedging instruments | Other derivatives | Other Non-Current Liabilities | ||
Derivatives, Fair Value | ||
Gross derivative liability | $ 0 | $ 0 |
Financial Instruments - Sched_4
Financial Instruments - Schedule of Information Related to the Potential Effect of Entity's Master Netting Agreements and Collateral Security Agreements (Details) - USD ($) $ in Millions | 9 Months Ended | |
Jul. 31, 2021 | Oct. 31, 2020 | |
Derivative assets | ||
Gross Amount Recognized | $ 191 | $ 195 |
Gross Amount Offset | 0 | 0 |
Net Amount Presented | 191 | 195 |
Gross Amounts Not Offset | ||
Derivatives | 133 | 156 |
Financial Collateral | 34 | 4 |
Net Amount | 24 | 35 |
Derivative liabilities | ||
Gross derivative liability | 231 | 262 |
Gross Amount Offset | 0 | 0 |
Net Amount Presented | 231 | 262 |
Gross Amounts Not Offset | ||
Derivatives | 133 | 156 |
Financial Collateral | 75 | 130 |
Net Amount | $ 23 | $ (24) |
Period to collateralize | 2 days |
Financial Instruments - Sched_5
Financial Instruments - Schedule of Pre-Tax Effect of Derivative Instruments and Related Hedged Items in a Fair Value Hedging Relationship (Details) - Interest rate contracts - Interest and other, net - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2021 | Jul. 31, 2020 | Jul. 31, 2021 | Jul. 31, 2020 | |
Derivative Instruments, Gain (Loss) | ||||
Total amounts of income/(expense) line items in the statement of financial performance in which the effects of fair value hedges are recorded | $ (55) | $ (28) | $ (106) | $ (15) |
Gain/(loss) recognized in earnings on derivative instruments | 5 | 1 | (5) | 11 |
Gain/(loss) recognized in earnings on hedged item | $ (5) | $ (1) | $ 5 | $ (11) |
Financial Instruments - Sched_6
Financial Instruments - Schedule of Pre-Tax Effect of Derivative Instruments in Cash Flow Hedging Relationships (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2021 | Jul. 31, 2020 | Jul. 31, 2021 | Jul. 31, 2020 | |
Pre-tax effect of derivative instruments in cash flow hedging relationships | ||||
(Loss)/gain recognized in Accumulated other comprehensive loss on derivative | $ 133 | $ (563) | $ (254) | $ (272) |
Total amounts of income/(expense) line items in the statement of financial performance in which the effects of cash flow hedges are recorded | 1,381 | 779 | 4,064 | 2,470 |
Gain/(loss) reclassified from Accumulated other comprehensive loss into earnings | (64) | 130 | (262) | 242 |
Cash flow hedges | ||||
Pre-tax effect of derivative instruments in cash flow hedging relationships | ||||
Total amounts of income/(expense) line items in the statement of financial performance in which the effects of cash flow hedges are recorded | 1,326 | 751 | 3,958 | 2,455 |
Gain/(loss) reclassified from Accumulated other comprehensive loss into earnings | (64) | 130 | (262) | 242 |
Cash flow hedges | Net revenue | ||||
Pre-tax effect of derivative instruments in cash flow hedging relationships | ||||
Total amounts of income/(expense) line items in the statement of financial performance in which the effects of cash flow hedges are recorded | 15,289 | 14,294 | 46,812 | 41,381 |
Gain/(loss) reclassified from Accumulated other comprehensive loss into earnings | (57) | 136 | (246) | 259 |
Cash flow hedges | Cost of revenue | ||||
Pre-tax effect of derivative instruments in cash flow hedging relationships | ||||
Total amounts of income/(expense) line items in the statement of financial performance in which the effects of cash flow hedges are recorded | (11,901) | (11,901) | (36,660) | (33,623) |
Gain/(loss) reclassified from Accumulated other comprehensive loss into earnings | (7) | (7) | (17) | (18) |
Cash flow hedges | Other operating expenses | ||||
Pre-tax effect of derivative instruments in cash flow hedging relationships | ||||
Total amounts of income/(expense) line items in the statement of financial performance in which the effects of cash flow hedges are recorded | (2,007) | (1,614) | (6,088) | (5,288) |
Gain/(loss) reclassified from Accumulated other comprehensive loss into earnings | 0 | 1 | 1 | 1 |
Cash flow hedges | Interest and other, net | ||||
Pre-tax effect of derivative instruments in cash flow hedging relationships | ||||
Total amounts of income/(expense) line items in the statement of financial performance in which the effects of cash flow hedges are recorded | (55) | (28) | (106) | (15) |
Gain/(loss) reclassified from Accumulated other comprehensive loss into earnings | 0 | 0 | 0 | 0 |
Foreign currency contracts | Cash flow hedges | ||||
Pre-tax effect of derivative instruments in cash flow hedging relationships | ||||
(Loss)/gain recognized in Accumulated other comprehensive loss on derivative | 167 | (567) | (220) | (268) |
Interest rate contracts | Cash flow hedges | ||||
Pre-tax effect of derivative instruments in cash flow hedging relationships | ||||
(Loss)/gain recognized in Accumulated other comprehensive loss on derivative | $ (34) | $ 4 | $ (34) | $ (4) |
Financial Instruments - Sched_7
Financial Instruments - Schedule of Pre-Tax Effect of Derivative Instruments not Designated as Hedging Instruments on the Consolidated Condensed Statements of Earnings (Details) - Interest and other, net - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2021 | Jul. 31, 2020 | Jul. 31, 2021 | Jul. 31, 2020 | |
Derivative Instruments, Gain (Loss) | ||||
Gain/(loss) recognized in earnings on derivative instrument | $ (35) | $ 57 | $ (38) | $ 79 |
Foreign currency contracts | ||||
Derivative Instruments, Gain (Loss) | ||||
Gain/(loss) recognized in earnings on derivative instrument | (33) | 46 | (42) | 63 |
Other derivatives | ||||
Derivative Instruments, Gain (Loss) | ||||
Gain/(loss) recognized in earnings on derivative instrument | $ (2) | $ 11 | $ 4 | $ 16 |
Borrowings - Schedule of Notes
Borrowings - Schedule of Notes Payable and Short-Term Borrowings (Details) - USD ($) $ in Millions | Jul. 31, 2021 | Oct. 31, 2020 |
Amount Outstanding | ||
Current portion of long-term debt | $ 181 | $ 633 |
Amount outstanding | $ 214 | $ 674 |
Weighted-Average Interest Rate | ||
Current portion of long-term debt | 3.30% | 4.00% |
Notes payable to banks, lines of credit and other | ||
Amount Outstanding | ||
Amount outstanding | $ 33 | $ 41 |
Weighted-Average Interest Rate | ||
Notes payable to banks, lines of credit and other | 1.60% | 1.60% |
Borrowings - Schedule of Long-T
Borrowings - Schedule of Long-Term Debt (Details) - USD ($) | Jul. 31, 2021 | Jun. 30, 2021 | Oct. 31, 2020 |
Long-term debt | |||
Fair value adjustment related to hedged debt | $ (2,000,000) | $ 2,000,000 | |
Unamortized debt issuance cost | (56,000,000) | $ (17,000,000) | (37,000,000) |
Current portion of long-term debt | (181,000,000) | (633,000,000) | |
Total long-term debt | 6,898,000,000 | 5,543,000,000 | |
U.S. Dollar Global Notes | |||
Long-term debt | |||
Long-term debt | 6,686,000,000 | 5,689,000,000 | |
$1,000 issued at discount to par at a price of 99.816% in September 2011 at 4.375%, due September 2021 | |||
Long-term debt | |||
Long-term debt | 0 | 412,000,000 | |
Face amount of debt instrument | $ 1,000,000,000 | ||
Discount to par (percent) | 99.816% | ||
Interest rate (percent) | 4.375% | ||
$1,500 issued at discount to par at a price of 99.707% in December 2011 at 4.65%, due December 2021 | |||
Long-term debt | |||
Long-term debt | $ 0 | 586,000,000 | |
Face amount of debt instrument | $ 1,500,000,000 | ||
Discount to par (percent) | 99.707% | ||
Interest rate (percent) | 4.65% | ||
$500 issued at discount to par at a price of 99.771% in March 2012 at 4.05%, due September 2022 | |||
Long-term debt | |||
Long-term debt | $ 499,000,000 | 499,000,000 | |
Face amount of debt instrument | $ 500,000,000 | ||
Discount to par (percent) | 99.771% | ||
Interest rate (percent) | 4.05% | ||
$1,200 issued at discount to par at a price of 99.863% in September 2011 at 6.00%, due September 2041 | |||
Long-term debt | |||
Long-term debt | $ 1,199,000,000 | 1,199,000,000 | |
Face amount of debt instrument | $ 1,200,000,000 | ||
Discount to par (percent) | 99.863% | ||
Interest rate (percent) | 6.00% | ||
$1,150 issued at discount to par at a price of 99.769% in June 2020 at 2.2%, due June 2025 | |||
Long-term debt | |||
Long-term debt | $ 1,148,000,000 | 1,148,000,000 | |
Face amount of debt instrument | $ 1,150,000,000 | ||
Discount to par (percent) | 99.769% | ||
Interest rate (percent) | 2.20% | ||
$1,000 issued at discount to par at a price of 99.718% in June 2020 at 3.0%, due June 2027 | |||
Long-term debt | |||
Long-term debt | $ 997,000,000 | 997,000,000 | |
Face amount of debt instrument | $ 1,000,000,000 | ||
Discount to par (percent) | 99.718% | ||
Interest rate (percent) | 3.00% | ||
$850 issued at discount to par at a price of 99.790% in June 2020 at 3.4%, due June 2030 | |||
Long-term debt | |||
Long-term debt | $ 848,000,000 | 848,000,000 | |
Face amount of debt instrument | $ 850,000,000 | ||
Discount to par (percent) | 99.79% | ||
Interest rate (percent) | 3.40% | ||
$1,000 issued at discount to par at a price of 99.808% in June 2021 at 1.45%, due June 2026 | |||
Long-term debt | |||
Long-term debt | $ 999,000,000 | 0 | |
Face amount of debt instrument | $ 1,000,000,000 | $ 1,000,000,000 | |
Discount to par (percent) | 99.808% | ||
Interest rate (percent) | 1.45% | 1.45% | |
$1,000 issued at discount to par at a price of 99.573% in June 2021 at 2.65%, due June 2031 | |||
Long-term debt | |||
Long-term debt | $ 996,000,000 | 0 | |
Face amount of debt instrument | $ 1,000,000,000 | $ 1,000,000,000 | |
Discount to par (percent) | 99.573% | ||
Interest rate (percent) | 2.65% | 2.65% | |
Other borrowings at 0.51-9.00%, due in calendar years 2021-2028 | |||
Long-term debt | |||
Other borrowings at 0.51-9.00%, due in calendar years 2021-2028 | $ 451,000,000 | $ 522,000,000 | |
Other borrowings at 0.51-9.00%, due in calendar years 2021-2028 | Minimum | |||
Long-term debt | |||
Interest rate (percent) | 0.51% | ||
Other borrowings at 0.51-9.00%, due in calendar years 2021-2028 | Maximum | |||
Long-term debt | |||
Interest rate (percent) | 9.00% |
Borrowings - Narrative (Details
Borrowings - Narrative (Details) | May 25, 2021USD ($) | Jul. 31, 2021USD ($)commercial_paper_program | Jul. 31, 2021USD ($)commercial_paper_program | Jul. 31, 2020USD ($) | Jul. 31, 2021USD ($)commercial_paper_program | Jul. 31, 2020USD ($) | Jun. 30, 2021USD ($) | Oct. 31, 2020USD ($) |
Line of Credit Facility [Line Items] | ||||||||
Issuance costs | $ 56,000,000 | $ 56,000,000 | $ 56,000,000 | $ 17,000,000 | $ 37,000,000 | |||
Loss on extinguishment of debt | $ 16,000,000 | $ 40,000,000 | $ 16,000,000 | $ 40,000,000 | ||||
Number of commercial paper programs | commercial_paper_program | 2 | 2 | 2 | |||||
Forward Contracts | Cash flow hedges | ||||||||
Line of Credit Facility [Line Items] | ||||||||
Derivative settlement, notional amount | 750,000,000 | |||||||
Interest Rate Swap | ||||||||
Line of Credit Facility [Line Items] | ||||||||
Derivative settlement, notional amount | $ 250,000,000 | $ 250,000,000 | $ 250,000,000 | |||||
Shelf Registration 2019 | ||||||||
Line of Credit Facility [Line Items] | ||||||||
Face amount of debt instrument | 2,000,000,000 | |||||||
$1,000 issued at discount to par at a price of 99.808% in June 2021 at 1.45%, due June 2026 | ||||||||
Line of Credit Facility [Line Items] | ||||||||
Face amount of debt instrument | $ 1,000,000,000 | $ 1,000,000,000 | $ 1,000,000,000 | $ 1,000,000,000 | ||||
Interest rate (percent) | 1.45% | 1.45% | 1.45% | 1.45% | ||||
$1,000 issued at discount to par at a price of 99.573% in June 2021 at 2.65%, due June 2031 | ||||||||
Line of Credit Facility [Line Items] | ||||||||
Face amount of debt instrument | $ 1,000,000,000 | $ 1,000,000,000 | $ 1,000,000,000 | $ 1,000,000,000 | ||||
Interest rate (percent) | 2.65% | 2.65% | 2.65% | 2.65% | ||||
$1,000 issued at discount to par at a price of 99.816% in September 2011 at 4.375%, due September 2021 | ||||||||
Line of Credit Facility [Line Items] | ||||||||
Face amount of debt instrument | $ 1,000,000,000 | $ 1,000,000,000 | $ 1,000,000,000 | |||||
Interest rate (percent) | 4.375% | 4.375% | 4.375% | |||||
Redeemed amount | $ 400,000,000 | $ 400,000,000 | $ 400,000,000 | |||||
$1,500 issued at discount to par at a price of 99.707% in December 2011 at 4.65%, due December 2021 | ||||||||
Line of Credit Facility [Line Items] | ||||||||
Face amount of debt instrument | $ 1,500,000,000 | $ 1,500,000,000 | $ 1,500,000,000 | |||||
Interest rate (percent) | 4.65% | 4.65% | 4.65% | |||||
Redeemed amount | $ 600,000,000 | $ 600,000,000 | $ 600,000,000 | |||||
Shelf Registration 2009 Due September 2021 And December 2021 | ||||||||
Line of Credit Facility [Line Items] | ||||||||
Loss on extinguishment of debt | 16,000,000 | |||||||
Commercial paper | ||||||||
Line of Credit Facility [Line Items] | ||||||||
Maximum borrowing capacity under credit facility | 6,000,000,000 | 6,000,000,000 | 6,000,000,000 | |||||
Revolving credit facility | ||||||||
Line of Credit Facility [Line Items] | ||||||||
Maximum borrowing capacity under credit facility | 5,000,000,000 | 5,000,000,000 | 5,000,000,000 | |||||
Revolving credit facility | Senior Unsecured Committed Revolving Credit Facility | ||||||||
Line of Credit Facility [Line Items] | ||||||||
Maximum borrowing capacity under credit facility | $ 4,000,000,000 | |||||||
Revolving credit facility | Revolving Credit Facility, 364-Day | ||||||||
Line of Credit Facility [Line Items] | ||||||||
Maximum borrowing capacity under credit facility | $ 1,000,000,000 | |||||||
Revolving credit facility, term | 364 days | |||||||
Credit facilities | ||||||||
Line of Credit Facility [Line Items] | ||||||||
Available borrowing resources | $ 575,000,000 | $ 575,000,000 | $ 575,000,000 |
Stockholders' Deficit - Narrati
Stockholders' Deficit - Narrative (Details) - USD ($) shares in Millions, $ in Millions | 1 Months Ended | 3 Months Ended | 9 Months Ended | |||
Aug. 31, 2021 | Aug. 31, 2020 | Jul. 31, 2021 | Jul. 31, 2020 | Jul. 31, 2021 | Jul. 31, 2020 | |
Stockholders' Equity Note [Abstract] | ||||||
Repurchases of common stock (shares) | 50 | 59 | 163 | 97 | ||
Payment in connection with repurchases of shares | $ 1,500 | $ 1,000 | $ 4,495 | $ 1,767 | ||
Share repurchase authorization remaining | $ 8,200 | $ 8,200 | ||||
Subsequent Event [Line Items] | ||||||
Shares settled (in shares) | 2.8 | |||||
Subsequent event | ||||||
Subsequent Event [Line Items] | ||||||
Shares settled (in shares) | 1.8 |
Stockholders' Deficit - Tax Eff
Stockholders' Deficit - Tax Effects Related to Other Comprehensive (Loss) Income (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2021 | Jul. 31, 2020 | Jul. 31, 2021 | Jul. 31, 2020 | |
Components of accumulated other comprehensive income, net of taxes | ||||
Tax (provision) benefit on other comprehensive income (loss) | $ (32) | $ 104 | $ (41) | $ 71 |
Tax provision on unrealized gains arising during the period | ||||
Components of accumulated other comprehensive income, net of taxes | ||||
Tax effects on change arising during the period | 0 | 0 | (1) | 0 |
Net unrealized (losses) gains on cash flow hedges | ||||
Components of accumulated other comprehensive income, net of taxes | ||||
Tax effects on change arising during the period | (22) | 83 | 18 | 34 |
Tax effects on reclassification into earnings | (4) | 25 | (25) | 51 |
Tax (provision) benefit on other comprehensive income (loss) | (26) | 108 | (7) | 85 |
Tax benefit (provision) on (losses) gains arising during the period | ||||
Components of accumulated other comprehensive income, net of taxes | ||||
Tax effects on change arising during the period | 0 | 1 | (11) | 1 |
Tax benefit on amortization of actuarial loss and prior service benefit | ||||
Components of accumulated other comprehensive income, net of taxes | ||||
Tax effects on reclassification into earnings | (4) | (5) | (14) | (15) |
Unrealized components of defined benefit plans | ||||
Components of accumulated other comprehensive income, net of taxes | ||||
Tax (provision) benefit on other comprehensive income (loss) | (4) | (4) | (25) | (14) |
Change in cumulative translation adjustment | ||||
Components of accumulated other comprehensive income, net of taxes | ||||
Tax (provision) benefit on other comprehensive income (loss) | $ (2) | $ 0 | $ (8) | $ 0 |
Stockholders' Deficit - Changes
Stockholders' Deficit - Changes and Reclassifications Related to Other Comprehensive Income, Net of Taxes (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2021 | Jul. 31, 2020 | Jul. 31, 2021 | Jul. 31, 2020 | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||
Unrealized gains arising during the period | $ (176) | |||
Losses (gains) reclassified into earnings | 285 | |||
Other comprehensive income (loss), net of taxes | $ 187 | $ (555) | 110 | $ (380) |
Change in unrealized gains (losses) on available-for-sale securities | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||
Unrealized gains arising during the period | 1 | 2 | 4 | 1 |
Losses (gains) reclassified into earnings | 0 | |||
Net unrealized (losses) gains on cash flow hedges | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||
Unrealized gains arising during the period | 111 | (480) | (236) | (238) |
Losses (gains) reclassified into earnings | 60 | (105) | 237 | (191) |
Other comprehensive income (loss), net of taxes | 171 | (585) | 1 | (429) |
Tax benefit (provision) on (losses) gains arising during the period | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||
Unrealized gains arising during the period | (1) | (4) | 29 | (5) |
Tax benefit on amortization of actuarial loss and prior service benefit | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||
Losses (gains) reclassified into earnings | 16 | 15 | 48 | 46 |
Curtailments, settlements and other | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||
Losses (gains) reclassified into earnings | 0 | 2 | 1 | 3 |
Change in unrealized components of defined benefit plans | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||
Unrealized gains arising during the period | 29 | |||
Losses (gains) reclassified into earnings | 48 | |||
Other comprehensive income (loss), net of taxes | 15 | 13 | 78 | 44 |
Change in cumulative translation adjustment | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||
Unrealized gains arising during the period | 27 | |||
Losses (gains) reclassified into earnings | 0 | |||
Change in cumulative translation adjustment | $ 0 | $ 15 | $ 27 | $ 4 |
Stockholders' Deficit - Accumul
Stockholders' Deficit - Accumulated Other Comprehensive Loss, Net of Taxes (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2021 | Jul. 31, 2020 | Jul. 31, 2021 | Jul. 31, 2020 | |
Components of accumulated other comprehensive income, net of taxes | ||||
Balance at beginning of period | $ (2,228) | |||
Other comprehensive income (loss) before reclassifications | (176) | |||
Reclassifications of losses into earnings | 285 | |||
Balance at end of period | $ (3,942) | (3,942) | ||
Accumulated other comprehensive loss | ||||
Components of accumulated other comprehensive income, net of taxes | ||||
Balance at beginning of period | (1,243) | |||
Balance at end of period | (1,133) | (1,133) | ||
Net unrealized gains on available-for-sale debt securities | ||||
Components of accumulated other comprehensive income, net of taxes | ||||
Balance at beginning of period | 11 | |||
Other comprehensive income (loss) before reclassifications | 1 | $ 2 | 4 | $ 1 |
Reclassifications of losses into earnings | 0 | |||
Balance at end of period | 15 | 15 | ||
Net unrealized (losses) gains on cash flow hedges | ||||
Components of accumulated other comprehensive income, net of taxes | ||||
Balance at beginning of period | (66) | |||
Other comprehensive income (loss) before reclassifications | 111 | (480) | (236) | (238) |
Reclassifications of losses into earnings | 60 | $ (105) | 237 | $ (191) |
Balance at end of period | (65) | (65) | ||
Unrealized components of defined benefit plans | ||||
Components of accumulated other comprehensive income, net of taxes | ||||
Balance at beginning of period | (1,190) | |||
Other comprehensive income (loss) before reclassifications | 29 | |||
Reclassifications of losses into earnings | 48 | |||
Balance at end of period | (1,112) | (1,112) | ||
Reclassifications of settlements into earnings | ||||
Components of accumulated other comprehensive income, net of taxes | ||||
Reclassifications of losses into earnings | 1 | |||
Change in cumulative translation adjustment | ||||
Components of accumulated other comprehensive income, net of taxes | ||||
Balance at beginning of period | 2 | |||
Other comprehensive income (loss) before reclassifications | 27 | |||
Reclassifications of losses into earnings | 0 | |||
Balance at end of period | $ 29 | $ 29 |
Net Earnings Per Share (Details
Net Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2021 | Jul. 31, 2020 | Jul. 31, 2021 | Jul. 31, 2020 | |
Numerator: | ||||
Net earnings | $ 1,108 | $ 734 | $ 3,404 | $ 2,176 |
Denominator: | ||||
Weighted-average shares used to compute basic net EPS (shares) | 1,185 | 1,417 | 1,235 | 1,435 |
Dilutive effect of employee stock plans (shares) | 14 | 6 | 12 | 6 |
Weighted-average shares used to compute diluted net EPS (shares) | 1,199 | 1,423 | 1,247 | 1,441 |
Net earnings per share: | ||||
Basic (usd per share) | $ 0.94 | $ 0.52 | $ 2.76 | $ 1.52 |
Diluted (usd per share) | $ 0.92 | $ 0.52 | $ 2.73 | $ 1.51 |
Anti-dilutive weighted average stock-based compensation awards (shares) | 0 | 15 | 2 | 13 |
Litigation and Contingencies (D
Litigation and Contingencies (Details) € in Millions, $ in Millions | Apr. 13, 2021plaintiff | Dec. 17, 2020case | Dec. 07, 2020EUR (€)Claim | Nov. 11, 2020patent | Sep. 18, 2020patent | Dec. 12, 2019patent | Sep. 20, 2019patentcase | Jun. 11, 2019casepatent | Nov. 23, 2016plaintiff | Aug. 18, 2016age | Jun. 30, 2016USD ($) | Oct. 01, 2015USD ($) | Apr. 17, 2015USD ($)employeesubsidiary | Jan. 24, 2013USD ($) | Dec. 11, 2012USD ($) | Apr. 21, 2012USD ($) | May 10, 2010USD ($)employee | Sep. 30, 2020patentcase | Jul. 31, 2021patent | Jan. 14, 2021patent | Mar. 25, 2020case | Jan. 23, 2020case | Apr. 20, 2012USD ($) | Apr. 11, 2012USD ($) |
Forsyth, et al. v. HP Inc. and Hewlett Packard Enterprise | ||||||||||||||||||||||||
Litigation and Contingencies | ||||||||||||||||||||||||
Minimum age of plaintiff | age | 40 | |||||||||||||||||||||||
Number of opt-in plaintiffs | plaintiff | 36 | |||||||||||||||||||||||
India Directorate of Revenue Intelligence Proceedings | ||||||||||||||||||||||||
Litigation and Contingencies | ||||||||||||||||||||||||
Number of current employees | employee | 7 | |||||||||||||||||||||||
Number of former employee | employee | 1 | |||||||||||||||||||||||
Aggregate damages sought | $ 370 | |||||||||||||||||||||||
Loss contingency deposit to prevent interruption of business | $ 16 | |||||||||||||||||||||||
Duties and penalties under show cause notices | $ 17 | $ 386 | ||||||||||||||||||||||
Amount deposited under show cause notice prior to order | $ 7 | $ 9 | ||||||||||||||||||||||
Additional amount deposited against products-related show cause notice | $ 10 | |||||||||||||||||||||||
Additional amount deposited against parts-related show cause notice | $ 3 | |||||||||||||||||||||||
Additional amount deposited against product order | $ 24 | |||||||||||||||||||||||
Autonomy-Related Legal Matters | Autonomy | ||||||||||||||||||||||||
Litigation and Contingencies | ||||||||||||||||||||||||
Aggregate damages sought | $ 5,000 | |||||||||||||||||||||||
Number of subsidiaries | subsidiary | 4 | |||||||||||||||||||||||
Number of members | employee | 2 | |||||||||||||||||||||||
Autonomy-Related Legal Matters | Autonomy | Mr. Lynch | ||||||||||||||||||||||||
Litigation and Contingencies | ||||||||||||||||||||||||
Aggregate damages sought | $ 160 | |||||||||||||||||||||||
Oracle Corporation v. HP | ||||||||||||||||||||||||
Litigation and Contingencies | ||||||||||||||||||||||||
Damages awarded | $ 3,000 | |||||||||||||||||||||||
Oracle Corporation v. HP | Past lost profits | ||||||||||||||||||||||||
Litigation and Contingencies | ||||||||||||||||||||||||
Damages awarded | 1,700 | |||||||||||||||||||||||
Oracle Corporation v. HP | Future lost profits | ||||||||||||||||||||||||
Litigation and Contingencies | ||||||||||||||||||||||||
Damages awarded | $ 1,300 | |||||||||||||||||||||||
Slingshot Printing LLC Litigation | ||||||||||||||||||||||||
Litigation and Contingencies | ||||||||||||||||||||||||
Purported consumer class actions filed | case | 4 | 3 | 5 | 5 | ||||||||||||||||||||
Patents allegedly infringed | patent | 32 | 16 | 2 | 31 | ||||||||||||||||||||
Amended claims | case | 3 | |||||||||||||||||||||||
Cases dismissed | patent | 1 | |||||||||||||||||||||||
New claims filed | case | 2 | |||||||||||||||||||||||
Number of patents petitions granted | patent | 4 | |||||||||||||||||||||||
Philips Patent Litigation | ||||||||||||||||||||||||
Litigation and Contingencies | ||||||||||||||||||||||||
Patents allegedly infringed | patent | 4 | |||||||||||||||||||||||
Caltech Patent Litigation | ||||||||||||||||||||||||
Litigation and Contingencies | ||||||||||||||||||||||||
Patents allegedly infringed | patent | 5 | |||||||||||||||||||||||
123Inkt Foundation Litigation | ||||||||||||||||||||||||
Litigation and Contingencies | ||||||||||||||||||||||||
Number of plaintiffs | plaintiff | 960 | |||||||||||||||||||||||
Italy Consumer Protection Investigation | ||||||||||||||||||||||||
Litigation and Contingencies | ||||||||||||||||||||||||
Number of unfair commercial practices | Claim | 2 | |||||||||||||||||||||||
Settlement amount awarded to other party | € | € 10 | |||||||||||||||||||||||
Number of days to file compliance report | 60 days | |||||||||||||||||||||||
Number of days to publish corrective statement | 120 days | |||||||||||||||||||||||
Number of days to amend packaging | 120 days | |||||||||||||||||||||||
Italy Consumer Protection Investigation, Unfair Practice One | ||||||||||||||||||||||||
Litigation and Contingencies | ||||||||||||||||||||||||
Settlement amount awarded to other party | € | € 5 | |||||||||||||||||||||||
Italy Consumer Protection Investigation, Unfair Practice Two | ||||||||||||||||||||||||
Litigation and Contingencies | ||||||||||||||||||||||||
Settlement amount awarded to other party | € | € 5 | |||||||||||||||||||||||
Mobile Emergency Housing Corp v. HP, Inc. | ||||||||||||||||||||||||
Litigation and Contingencies | ||||||||||||||||||||||||
New claims filed | case | 7 |
Guarantees, Indemnifications _3
Guarantees, Indemnifications and Warranties (Details) $ in Millions | 9 Months Ended |
Jul. 31, 2021USD ($) | |
Changes in aggregated product warranty liabilities | |
Balance at beginning of period | $ 993 |
Accruals for warranties issued | 753 |
Adjustments related to pre-existing warranties (including changes in estimates) | 16 |
Settlements made (in cash or in kind) | (777) |
Balance at end of period | $ 985 |
Commitments (Details)
Commitments (Details) $ in Millions | Jul. 31, 2021USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
Unconditional purchase obligations | $ 6,815 |
Fiscal year | |
2021 | 692 |
2022 | 2,328 |
2023 | 2,276 |
2024 | 1,431 |
2025 | 70 |
Thereafter | 18 |
Total | $ 6,815 |
Acquisitions (Details)
Acquisitions (Details) - USD ($) $ in Millions | Jun. 01, 2021 | Jul. 31, 2021 | Oct. 31, 2020 |
Business Acquisition [Line Items] | |||
Goodwill | $ 6,628 | $ 6,380 | |
HyperX | |||
Business Acquisition [Line Items] | |||
Goodwill | $ 101 | ||
Amortizable intangible assets | 208 | ||
Net assets assumed | 103 | ||
Total fair value of consideration | $ 412 |
Intangible Assets - Schedule of
Intangible Assets - Schedule of Intangible Assets (Details) - USD ($) $ in Millions | 9 Months Ended | |
Jul. 31, 2021 | Oct. 31, 2020 | |
Finite-Lived Intangible Assets [Line Items] | ||
Gross | $ 1,341 | $ 1,029 |
Accumulated Amortization | 600 | 489 |
Total | 741 | 540 |
Customer contracts, customer lists and distribution agreements | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross | 479 | 382 |
Accumulated Amortization | 189 | 149 |
Total | $ 290 | 233 |
Weighted-Average Useful Life | 2 years | |
Technology and patents | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross | $ 764 | 621 |
Accumulated Amortization | 399 | 332 |
Total | $ 365 | 289 |
Weighted-Average Useful Life | 7 years | |
Trade name and trademarks | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross | $ 98 | 26 |
Accumulated Amortization | 12 | 8 |
Total | $ 86 | $ 18 |
Weighted-Average Useful Life | 15 years |
Intangible Assets - Schedule _2
Intangible Assets - Schedule of Estimated Future Amortization Expense (Details) - USD ($) $ in Millions | Jul. 31, 2021 | Oct. 31, 2020 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
2021 | $ 49 | |
2022 | 184 | |
2023 | 139 | |
2024 | 105 | |
2025 | 62 | |
Thereafter | 202 | |
Total | $ 741 | $ 540 |