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HP CFO Karen Parkhill reports memory cost challenges are impacting margin rates
Wednesday, March 18, 2026 at 06:00 PM
HP's financial leadership highlighted ongoing challenges regarding rising memory costs, noting that the company is adjusting pricing to offset the headwind on a dollar basis while acknowledging a potential slight negative impact on margin rates.
Context
At the Morgan Stanley TMT Conference on March 18, 2026, HP Inc. CFO Karen Parkhill addressed the significant pressure that rising memory costs are placing on the company’s financial performance. Parkhill stated, "Clearly, in the near-term environment, when we're dealing with the memory cost challenges, our focus is on offsetting those challenges, particularly on a dollar basis. So those challenges can have an impact on our margins because we're working as we price to offset the net impact of the headwinds on a dollar basis. So on a rate margin, that can have a slight negative impact."
This follows HP’s Q1 2026 earnings report, which revealed that DRAM and NAND prices spiked 100% sequentially, driving memory and storage to account for 35% of the PC bill of materials, up from 15-18% previously. While HP beat Q1 estimates with $14.44 billion in revenue, the company has guided fiscal year 2026 earnings to the lower end of its $2.90 to $3.20 range. To mitigate these headwinds, management is implementing a "playbook" of targeted price increases and securing long-term supply agreements to protect absolute dollar profits despite the compressed margin rates.
Sources (6)
HP Inc. Reports Fiscal 2026 First Quarter ResultsHP Sees Annual Profit at Low End of Forecast on Higher Memory Chip Costs - BloombergHP at Morgan Stanley Conference: Navigating Challenges with Strategic Focus By Investing.comHP, Inc. (HPQ)HP Delivers Surprise Beat but Signals Trouble Ahead as Memory Costs Double - AOLHP takes ‘targeted pricing actions’ as mass memory chip shortages persist | Channel Dive
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