The pandemic forced company staff to work from home, driving the need for PC and laptop upgrades. Previously, smartphone innovation was so fast-paced that sales outpaced computer demand for years. Today, the big brand names like HP (NYSE:HPQ) and Dell (NYSE:DELL) are poised to reward investors. As the pandemic continues through the fall season, computer sales will increase.
In the third quarter, HP posted personal systems revenue rising 7% Y/Y to $10.4 billion. Consumers drove sales 42% higher. As expected, printing net revenue fell 20% Y/Y. Work-from-home lowered printing needs. While HP sold 11% more computer units, desktop sales fell 30%, while notebook sales grew 32%. Looking ahead, HP forecast free cash flow in the range of $2.5 billion to $3.0 billion.
HPQ stock is one of the most under-valued tech stocks on the market.
In its Q2, Dell posted sales at its virtualization unit, VMware, rising 10% to $2.9 billion. Recurring revenue rose 15% to $6 billion. Dell generated $3.3 billion in cash from operating activities. With $12.3 billion in cash on hand, it paid down $3.6 billion in debt.
Dell’s Infrastructure Solutions Group is a bright spot. Revenue topped $8.2 billion. The cloud and networking demand will only increase, suggesting that Dell stock will continue its uptrend.
