Fiscal 2017 free cash flow is expected to move from $2.3 to $2.6 billion, and increases are planned in the quarterly dividend amount of 7%. An additional share repurchase has been authorized for $3 billion for future repurchases.
HP, Inc. expects to return 50-75% of fiscal 2017 free cash flow to shareholders through dividends and share repurchases. At HP Inc.’s 2016 Securities Analyst Meeting (SAM), the company provided details on its strategy and opportunities for long-term growth, coupled with its financial outlook for FY17. "I’m proud of the progress we have made in our first year as the new HP. Our focus is clear, our execution is solid, and we are positioned well for the next step in our journey," said Dion Weisler, president and CEO, HP. "We are confident in our strategy and believe it will continue to produce reliable returns and cash flow while also enabling HP to invest in differentiated innovation and long-term growth.
"Although our markets remain very challenged, we are committed to innovating in the core and continue to see long-term growth opportunities in commercial mobility and services, the disruption of the A3 copier market, and the digitization of graphics and manufacturing through our leading 3D printing solutions," he added.
Fiscal 2017 non-GAAP diluted net earnings per share estimates exclude after-tax costs primarily related to items such as restructuring and other charges, defined benefit plan settlement charges, non-operating retirement-related credits/(charges), tax indemnifications, net valuation allowances, separation taxes and adjustments, acquisition and other related charges, discontinued operations and amortization of intangible assets. Based on the current environment, HP anticipates generating cash flow from operations of approximately $2.8 to $3.1 billion in fiscal 2017. With about $0.5 billion in net capital expenditures, free cash flow outlook is in the range of $2.3 to $2.6 billion for fiscal 2017.
"We are increasing our quarterly dividend as a demonstration of our confidence in our execution and the sustainability of our cash flow," said Cathie Lesjak, chief financial officer, HP. "HP continues to be a compelling investment opportunity. The combination of our recurring revenue streams, negative cash conversion cycle, and efficient operating model drives strong operating margins and cash flow."