On The Fly: What to watch in HP Inc.'s earnings report

HP Inc. (HPQ) is scheduled to report results of its fiscal second quarter after the market close on May 24, with a conference call scheduled for 5:00 pm ET. What to watch for: 1. Q2 EPS CONSENSUS UNCHANGED: Along with its last report, HP Inc. guided for Q2 earnings per share in the range of 37c-40c. At the time, analysts expected the company to report Q2 EPS of 39c, a consensus figure which remains unchanged. In addition, HP Inc. said in a slide presentation prepared for its Q1 earnings conference call that it sees fiscal 2017 adjusted EPS in the range of $1.55-$1.65. At the time, analysts expected the company to report FY17 adjusted EPS of $1.59, but that figure has since risen to $1.62. 2. WELLS FARGO KEEPS OUTPERFORM: Yesterday, Wells Fargo analyst Maynard Um maintained an Outperform rating on HP Inc., saying that he expects Q2 results tob eat expectations, driven by improving printer and PC trends. Um said he anticipates positive PC mix shifts to bolster the company's margins in the second half of 2017 and added that there is scope for an increase to its FY17 free cash flow guidance of $2.3B-$2.6B. 3. CORTANA-POWERED DEVICES: Earlier this month, Engadget reported, citing comments made at Microsoft's (MSFT) Build 2017 conference, that HP and Intel (INTC) are working on connected-home devices that run Microsoft's Cortana platform. Such devices will compete with Amazon's (AMZN) Alexa assistant as well as Google (GOOG) Assistant. 4. PC SHIPMENTS: According to preliminary results by Gartner (IT) released in April, global PC shipments totaled 62.2M units in the first quarter, marking a 2.4% decline from the same quarter of the previous year. Q1 was the first time since 2007 that the PC market experienced shipments below 63 units in a quarter, Gartner said. Lenovo (LNVGY) remained in first place in global PC market share, boosting its share to 19.9% in 1Q17 from 19.2% in 1Q16. HP Inc. remained in second place, but saw more market share growth, increasing from 17.9% in 1Q16 to 19.5% in 1Q17.