(b) Pursuant to adoption of ASU 2017-07, “Compensation - Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Post-retirement Benefit Cost”, in the first quarter of fiscal year 2019, HP now reclassifies all components (excluding service cost component) of net periodic benefit cost from Selling, general and administrative expenses to Interest and other, net. HP reflected this change in prior reporting periods on an as-if basis.
HP INC. AND SUBSIDIARIES
ADJUSTMENTS TO GAAP NET EARNINGS, EARNINGS FROM OPERATIONS,
OPERATING MARGIN AND DILUTED NET EARNINGS PER SHARE
(Unaudited)
(In millions, except per share amounts)
| Nine months ended | |||||||||||||||
| July 31, 2019 | July 31, 2018 | ||||||||||||||
| Amounts |
Diluted
net earnings per share | Amounts |
Diluted
net earnings per share | ||||||||||||
| GAAP net earnings | $ | 2,764 | $ | 1.80 | $ | 3,876 | $ | 2.36 | |||||||
| Non-GAAP adjustments: | |||||||||||||||
| Restructuring and other charges | 141 | 0.09 | 92 | 0.06 | |||||||||||
| Acquisition-related charges | 12 | 0.01 | 97 | 0.06 | |||||||||||
| Amortization of intangible assets | 87 | 0.06 | 60 | 0.04 | |||||||||||
| Non-operating retirement-related credits | (43 | ) | (0.03 | ) | (165 | ) | (0.10 | ) | |||||||
| Defined benefit plan settlement charges | — | — | 2 | — | |||||||||||
| Debt extinguishment costs | — | — | 126 | 0.08 | |||||||||||
| Tax adjustments(a)
| (451 | ) | (0.30 | ) | (1,647 | ) | (1.02 | ) | |||||||
| Non-GAAP net earnings | $ | 2,510 | $ | 1.63 | $ | 2,441 | $ | 1.48 | |||||||
| GAAP earnings from operations (b) | $ | 2,933 | $ | 2,837 | |||||||||||
| Non-GAAP adjustments: | |||||||||||||||
| Restructuring and other charges | 141 | 92 | |||||||||||||
| Acquisition-related charges | 12 | 97 | |||||||||||||
| Amortization of intangible assets | 87 | 60 | |||||||||||||
| Non-GAAP earnings | $ | 3,173 | $ | 3,086 | |||||||||||
| GAAP operating margin (b) | 7 | % | 7 | % | |||||||||||
| Non-GAAP adjustments | 0 | % | 0 | % | |||||||||||
| Non-GAAP operating margin | 7 | % | 7 | % | |||||||||||
(a) Includes tax impact on non-GAAP adjustments.
